check out this article on cbh takeover !!!

UNSOLICITED OFFER

Nyrstar offers $137m for CBH Resources
The bid for the Australian zinc miner comes as CBH is getting ready to double output and as Nyrstar's current main source of Australian supply nears the end of its natural life

Author: James Regan (Reuters)
Posted: Monday , 11 Jan 2010

SYDNEY (Reuters) -

Zinc metal producer Nyrstar NV (NYR.BR: Quote) has offered around A$148 million ($137 million) for Australian zinc miner CBH Resources (CBH.AX: Quote) in an unsolicited move to secure further access to raw materials.

A takeover could redirect more than 59,000 tonnes of zinc in concentrate shipped annually to Toho Zinc (5707.T: Quote) in Japan to Nyrstar smelters in Australia and Europe.

It also comes as Nyrstar's major source of supply in Australia, the Century zinc mine owned by Minmetals, nears the end of its natural mine life.

Nyrstar already buys all the lead mined by CBH from its Endeavor mine in central Australia, though the more-prized and plentiful zinc ore is bought by Toho and shipped to Japan for smelting.

Toho owns 23% of CBH's stock and is the company's largest shareholder.

CBH this year is reactivating equipment, idled in 2008 when zinc prices crashed, that will allow it to more than double ore production to 850,000 tonnes, yielding about 59,000 tonnes of zinc metal and 30,000 tonnes of lead.

Lead ore from the mine is fed to a Nyrstar smelter in nearby Port Pirie, Australia.

CBH is also seeking various approvals to develop a second Australian mine starting later this year that will eventually match the size of the Endeavor lode.

"After a rocky time with low zinc prices, CBH now looks like a decent growth story and that's what's got Nyrstar interested," a source familiar with Nyrstar's acquisition strategy said on condition of anonymity.

CBH said Nyrstar had offered A$0.135 cents cash per CBH share or alternatively Nyrstar shares to acquire the company.

The CBH share price, which shot up from 10 cents at the start of last week to 14.5 cents before being placed on trading halt, edged down 3.5 percent on Monday to 14 cents.

A CBH spokesperson said the offer was unsolicited and that it had hired Clayton Utz and RBC Capital to advise on its next move.

In October, Nyrstar was temporarily forced to find alternative ore supplies after the Century mine unexpectedly halted shipments to repair a faulty pipeline. The Century mine is scheduled to run dry around mid-2015.

But even before the incident at Century, Nyrstar was showing interest in the mining business, abandoning a founding strategy of sticking to smelting and leaving mining to outside parties.

Another Australia-listed company, Ironbark Gold Ltd (IBG.AX: Quote), has agreed to supply Nyrstar with 35% of the output from a zinc mine in Greenland under a A$6.6 million placement that gives Nyrstar a 19.9% stake in the company.

Other acquisitions include the East Tennessee zinc mine complex in the United States from Glencore, having already bought the SRA mine complex last May.

It also bought an 85% interest in the Coricancha polymetallic mine in Peru.

Zinc futures MZN3 are trading at around $2,555 per tonne, against about $1,500 in mid-July and about $1,100 a year ago.

A year ago, Chinese zinc miner Zhongjin Lingnan took a 50.1% stake in Australian zinc miner Perilya Ltd (PEM.AX: Quote) in return for a A$45.5 million cash injection that kept the mine open and fended off a takeover attempt by CBH.

CBH also said it had not been approached by Perilya, dousing speculation the two companies were in talks again.

Nyrstar was formed when Belgium's Umicore merged its zinc smelting businesses with those of the former Zinifex. (Editing by Michael Urquhart)