The AustralianNew twist in battle for Flinders MinesBY: ROBB...

The Australian

New twist in battle for Flinders Mines
BY: ROBB STEWART From: The Australian June 16, 2012 12:00AM
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IN the latest twist in the proposed takeover of aspiring Australian iron ore producer Flinders Mines, the Takeovers Panel says it has received an application to have the "quit date" for the bid from Magnitogorsk Iron & Steel Works extended because of a challenge by one of the Russian steel company's shareholders.

The regulator said yesterday that Geraldine Carter, a shareholder in Flinders, had claimed that an injunction in Russia effectively freezing the takeover had given rise to "unacceptable circumstances" and the acquisition of Flinders shares was not taking place in an effective market.

Carter is seeking interim orders from the panel to extend the deadline for the bid to July 14, or another date the panel deems appropriate.

Flinders and Magnitogorsk were close to finalising the $554 million agreed deal when a minority shareholder named Elena Egorova secured an injunction in Chelyabinsk, a Russian city close to Magnitogorsk's base, against the takeover. Egorova, about whom little is known, has alleged the purchase of Flinders could lead to risks for Magnitogorsk that could reduce the value of her investment.


Flinders shareholders in late March voted in favour of the deal, but days later, the Australian company issued a statement saying the transaction had been blocked.

Flinders on June 8 said appeals by it and Magnitogorsk against the injunction had been dismissed and the next court hearing regarding the legal action would be on July 2 -- after the June 30 deadline to complete the takeover.

Allan Bulman, director of the Takeovers Panel in Melbourne, said a panel would be formed soon to decide whether to conduct hearings into Carter's application.

Flinders is developing an iron ore project in the western Pilbara region and has plans for mining that could produce 15 million tonnes annually beginning in late 2014.