News: BC Iron to buy Iron Ore Holdings

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BC Iron Limited (ASX:BCI) is poised to strengthen its Pilbara iron ore portfolio through the acquisition of Iron Ore Holdings Limited (ASX:IOH). 

 

Both companies have agreed to enter a bid implementation agreement under which BC Iron will offer to acquire Iron Ore Holdings through an off-market takeover. 

 

The deal will see Iron Ore Holdings shareholders receive 0.44 new BC shares and $0.10 in cash for every Iron Ore Holdings share held. The offer values Iron Ore Holdings at $1.59 per share, who last closed at $0.95 ahead of today’s announcement. 

 

Iron Ore Holdings board has unanimously backed the offer and its major shareholder, Australian Capital Equity holds a stake of about 53 per cent, also intends to accept the offer. 

 

BC Iron reported a net profit of $70.3 million in the first half of the 2014 financial year.