HONG Kong-listed Regent Pacific Group has terminated a $345 million bid for BC Iron because of opposition to the deal from BC's major shareholder Consolidated Minerals.
Regent Pacific said in a statement that in light of ConsMin's unqualified position that it is 'flatly opposed' to the scheme, Regent's board had decided to withdraw the offer.
Regent holds a 19.9% stake in BC, while ConsMin has a 21.1% interest. The Hong Kong company's $3.30-a-share offer represented a 4% premium to BC’s previous close prior to the bid being launched on January 21 and an 18% premium to the shares' one-month volume-weighted average.
BC, which operates the Nullagine project in Western Australia's Pilbara region through a joint venture with Fortescue Metals Group, had supported the bid.
The Regent Pacific statement said, "ConsMin's unqualified position that it is 'flatly opposed' to the scheme has plainly been of concern to the company, a concern shared by the market.
“The company has made attempts to engage ConsMin with a view to having the opportunity to explain the merits of the proposed transaction and gauge ConsMin's reaction to it.
“At the time of this announcement, ConsMin has declined to clarify the unqualified position presented.”
Regent said through its shareholding in BC it remained committed to the Pilbara iron ore junior. The company added that it is still pursuing its stated strategy of becoming Hong Kong's next major mid-tier mining house focused on bulk commodities, base metals and gold in the Asia-Pacific region.