Welcome To The Spider Resources HUB On AGORACOM

First Explorer at the "Ring of Fire" and presently drilling on the "BIG DADDY" Chromite/Pge's jv'd property...yet we were robbed

Free
Message: Another Attempt to stop the Merger
Reply New Message
Prev Message Back To Forum Threaded View Next Message
UPDATE 1-Cliffs may not bid for KWG, sticks with Spider
06/07/10 - 12:13 PM ET - Reuters
* Cliffs reconsidering bid after KWG-Spider move

* Cliffs aims to gain majority stake in chromite deposit (In U.S. dollars unless noted)

TORONTO, June 7 (Reuters) - Cliffs Natural Resources said on Monday it might not go through with a plan to bid for KWG Resources , but said it will continue with its offer for Spider Resources as it tries to expand its chromite assets in Northern Ontario.

Cliffs said two weeks ago it planned to launch offers for both KWG and Spider, which each own 26.5 percent of the Bid Daddy chromite deposit on the west side of Canada's James Bay. Cliffs currently owns 47 percent of the deposit.

KWG and Spider responded by announcing they would merge under the KWG banner in a complicated all-stock deal, prompting Cliffs to reconsider its plan.

Cliffs launched a formal bid for Spider on May 31, but has yet to make a KWG offer.

"Cliffs... continues to review its options with respect to making a formal offer for the common shares of KWG Resources and may not make such an offer in light of KWG's disclosure (of a deal with Spider)," Cleveland-based Cliffs said in a statement.

Cliffs, North America's largest producer of iron ore pellets, said it remains firmly committed to the offer for Spider, which values Spider at 13 Canadian cents a share, or just under C$70 million, based on Reuters share data.

KWG's shares fell slightly on the news, while Spider's stock edged higher.

Chromite is an essential raw material for the production of chromium, which is used in the production of stainless steel.

Cliffs said its goal is to obtain a majority of the Big Daddy deposit, and noted it needs to acquire either Spider or KWG -- but not necessarily both -- to achieve that goal.

The deposit sits near Cliffs' Black Thor and Black Label chromite deposits in the so-called Ring of Fire region, which is a newly discovered 5,000-sq-km (1,930-sq-mile) area that also contains nickel, copper, platinum, gold, and other minerals.

Shares of TSX Venture-listed KWG were down 1/2 of a Canadian cent at 13 Canadian cents, while Spider was up 1/2 of a Canadian cent at 14 Canadian cents. Cliffs was up 1.1 percent at $49.76 on the New York Stock Exchange.
5 Recommendations
Reply New Message
Prev Message Back To Forum Threaded View Next Message
Share
Share
New Message
Please login to post a reply