its not only shareholders asking questions

BHP Billiton trumps China placement with takeover offer for United Minerals Corporation
by Andrew McCrea


BHP Billiton has lobbed a cash takeover offer for Pilbara iron ore developer United Minerals Corporation (ASX: UMC) at $1.30 per share.

UMC last traded at $0.91 per share, the company was suspended, pending an announcement.

The offer values UMC at $204 million.

The offer is conditional upon UMC not proceeding with the proposed placement of shares to China Railway Materials Commercial Corp. Group (CRM).

BHP proposes to acquire all of the issued shares in UMC via a board recommended Scheme of Arrangement.

Whether the takeover values UMC at full value, or an alternate bidder is flushed out remains to be seen. The offer price for UMC shareholders is at a 42.3% premium to last sale price of UMC. UMC shareholders will perhaps have to ponder if the company would not have reached the $200 million valuation, and higher under its own steam.

That said, UMC would have needed to strike a rail deal with either BHP, Rio Tinto or Fortescue Metals - this may have tipped the deal in favour of the BHP offer.