First Quantum Won't Raise C$189.3 Million Adastra Bid (Update1)
2006-02-13 05:47 (New York)
(Adds shares in fifth paragraph.)
By Stewart Bailey
Feb. 13 (Bloomberg) -- First Quantum Minerals Ltd., which
mines copper in Zambia and the Democratic Republic of Congo, won't
raise its CS189.3 million ($164 million) bid for smaller rival
Adastra Minerals Inc., Chairman Philip Pascall said.
``We won't raise the bid,'' Pascall, First Quantum's founder,
said yesterday in an interview at the company's Kansanshi mine
near Solwezi in northwest Zambia. ``It's a good bid.''
First Quantum, based in Vancouver, on Jan. 18 made a hostile
all-stock offer for London-based Adastra, which plans to develop a
copper and cobalt project at Kolwezi in the southern Congo.
Adastra's management, supported by investors holding over half its
stock, on Feb. 3 rejected First Quantum's offer as too low.
The offer will last for 35 days and two-thirds of Adastra's
shares need to be tendered for it to be successful. First Quantum
shareholders would own 93 percent of the combined company.
Adastra shares fell 1 pence, or 0.8 percent, to 125.5 pence
as of 10:42 a.m. in London, paring their gains since the bid was
made to 43 percent.
Next month, Adastra plans to release the results of a study
determining the viability of processing 30-year-old mine waste at
Kolwezi to produce 35,000 metrics of copper and 5,000 tons of
cobalt a year.
Cobalt demand is rising on higher consumption of rechargeable
batteries, and prices have more than doubled in three years.
Copper traded at a record $5,100 a metric ton on Feb. 7.
First Quantum, along with Anglo American and BHP Billiton,
the world's biggest mining companies, are digging mines and
staking exploration claims in Congo's Katanga province, an area
that boasts 10 percent of the world's copper. The risks are high
as many as 1,000 Congolese die each day from ``war-related
causes,'' according to the International Crisis Group.
First Quantum may produce as much as 211,000 tons of copper
this year from mines in Zambia, Congo and Mauritania, said
Pascall.
The company will begin digging its Frontier mine in Congo
this year and would develop a new plant at Kolwezi in 2008, should
its Adastra bid be successful, he added.
--Editor: Griffiths. |
