Murchison said in a statement yesterday that "it has raised approximately $135 million in cash through the disposal of its holding in Midwest Corporation Limited".
"Murchison held 21.2 million shares representing a 9.2% stake in Midwest and has accepted the takeover offer for Midwest from Sinosteel.
"Proceeds from the sale will be used primarily to help develop the Company's existing projects."
Murchison also revealed that mediation over a legal action from Chameleon Mining NL had been unsuccessful, and Chameleon revealed that it had filed full security of costs for its legal action over rights to 5% direct interest in the Jack Hills and Weld Range leases held by Murchison.
Chameleon said its legal action was now due to be heard in court before Easter 2009. It claimed the value of the claim was between $150 million to $250 million.
Perhaps it was for that statement that Murchison shares fell 14% or 28 cents to $1.67 yesterday, which is a new 52 week low for the stock.
To complicate matters Harbinger has a big stake in Murchison, while Sinosteel has a smaller stake.
Midwest shares ended at $6.36, down 1 cent, ahead of the Sinosteel bid closing.
Sinosteel has reportedly lodged an application with the Foreign Investment Review Board seeking approval to purchase Murchison, which has nearby iron ore projects.
Murchison and its joint venture partner Mitsubishi were recently named the WA Government's preferred tenderer to build the port infrastructure at Oakajee to service the expected boom in iron ore production in the state's Mid West region.
That increases Murchison's attractiveness to Sinosteel.
MMX Price at posting:
$1.42 Sentiment: LT Buy Disclosure: Held
