Wyloo Metals declares $760 million takeover offer for Mincor Resources ‘best and final’

Wyloo Metals has declared its $760 million takeover offer for nickel producer Mincor Resources (ASX:MCR) to be its “best and final” amid an ongoing product quality dispute with mining behemoth BHP (ASX:BHP).

Andrew Forrest’s privately held Wyloo notes Mincor’s operations and guidance update announced to the Australian Securities Exchange (ASX) on 30 March 2023 was a surprise, with the company confirming it was unaware of the material information contained within the announcement.

As a result, Wyloo says the current offer price of $1.40 per share is its best and final and will not be increased, in the absence of a competing proposal.

Wyloo says the current offer price of $1.40 per share is its best and final and will not be increased, in the absence of a competing proposal

Wyloo encourages Mincor shareholders to read the bidder’s statement and the first supplementary bidder’s statement carefully and in their entirety before deciding whether to accept the offer. These statements together include information as to why Wyloo believes Mincor shareholders should accept the offer.

On 30 March, Mincor reported to the ASX that it combines ore from its Northern and Southern Operations to deliver a blended product to BHP’s Kambalda Nickel Concentrator. This ore is subject to product specification requirements, including a nickel-to-arsenic ratio. During the ramp-up period, Mincor has delivered off-specification product.

It said while BHP has been accepting off-specification product, both parties have been working together to explore and trial methods to better manage off-specification product going forward.

“This work remains ongoing. Mincor recently initiated discussions with BHP regarding potential amendments to the off-take terms to provide ongoing flexibility with respect to product specification requirements and provide Mincor certainty as to its ability to deliver 100% of mined ore to BHP.”

Mincor was notified on 29 March 2023 that BHP would not agree to amend the off-take agreement specifications. Given the lack of certainty regarding future acceptance of any off-specification product and the incomplete status of potential solutions, Mincor has decided to withdraw its guidance.

Mincor is an ASX listed Australian mining company involved in the exploration for and mining of mineral resources. It has 2 major projects – the Kambalda Nickel Operations, which comprise the brownfields Northern Operations and the greenfields Cassini Nickel Mine; and the Widgiemooltha Gold Project, a gold exploration opportunity.

Write to Adam Orlando at Mining.com.au

Images: Wyloo Metals Pty Ltd
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Written By Adam Orlando
Mining.com.au Editor-in-Chief Adam Orlando has more than 20 years’ experience in the media having held senior roles at various publications, including as Asia-Pacific Sector Head (Mining) at global newswire Acuris (formerly Mergermarket). Orlando has worked in newsrooms around the world including Hong Kong, Singapore, London, and Sydney.