IGO yet to make binding proposal for takeover target Western Areas
Questions are surfacing in the market about IGO’s intentions for Western Areas with it yet to come forward with a binding proposal for its takeover target.
Western Areas, currently worth $955m, has seen its share price fall sharply in the past week, prompting some to wonder whether the lithium miner has lost interest in the nickel miner.
However, others say IGO’s strongly performing share price suggests a deal is imminent and that the fall in the Western Areas price is linked to poor results.
The thinking is that IGO can improve the business.
Meanwhile, there is talk that one or two other bidders are waiting in the wings to buy Western Areas should IGO opt not to move forward with a proposal.
IGO told the market on September 21 that it had started due diligence on Western Areas.
The Perth-based company said at the time that it would progress due diligence over the coming weeks, but that there was no certainty a definitive transaction would result.
That was six weeks ago, and it is thought that the Western Areas camp is still waiting to learn of IGO’s intentions.
Some IGO shareholders are said to be relaxed about a deal not progressing with Western Areas, given that it would be happening so soon after the company has purchased a stake in West Australian lithium mine Greenbushes for $2bn.
Western Areas is advised by Rothschild & Co and Goldman Sachs, while IGO is working with Macquarie.
