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MMK to Acquire 100% of Flinders Mines Limited
11/28/2011 - Magnitogorsk Iron and Steel Works OJSC has executed a Scheme Implementation Agreement for the acquisition of 100% of the issued shares in Flinders Mines Limited by MMK at A$0.30 cash per share.
Magnitogorsk Iron and Steel Works OJSC has executed a Scheme Implementation Agreement for the acquisition of 100% of the issued shares in Flinders Mines Limited by MMK at A$0.30 cash per share. The offer implies a fully diluted value for Flinders of approximately A$554 million.
Flinders’ flagship asset, the Pilbara Iron Ore Project (PIOP), is located in the West Pilbara region of Western Australia. The PIOP has a large 917.3Mt JORC-compliant resource of high quality, direct shipping and easily beneficiable feed ore with average grade Fe 55.2%, with significant potential for further resource upgrades. Production at PIOP is scheduled to commence in 2015 with estimated annual volumes of 15 million tonne of saleable product.
“I am delighted to announce our agreement to acquire 100% of Flinders Mines,” said MMK Board of Directors Chairman Victor Rashnikov. “With the support of MMK and under the continued leadership of their professional management team, I am confident that Flinders will develop into a leading iron ore producer in Australia.”
Flinders’ flagship asset, the Pilbara Iron Ore Project (PIOP), is located in the West Pilbara region of Western Australia. The PIOP has a large 917.3Mt JORC-compliant resource of high quality, direct shipping and easily beneficiable feed ore with average grade Fe 55.2%, with significant potential for further resource upgrades. Production at PIOP is scheduled to commence in 2015 with estimated annual volumes of 15 million tonne of saleable product.
“I am delighted to announce our agreement to acquire 100% of Flinders Mines,” said MMK Board of Directors Chairman Victor Rashnikov. “With the support of MMK and under the continued leadership of their professional management team, I am confident that Flinders will develop into a leading iron ore producer in Australia.”
The transaction will give MMK access to a high-quality iron ore development project with a substantial resource base and robust economics with low operating and capital costs.
“This transaction represents another important step forward for MMK to become highly efficient vertically integrated international metals and mining company,” added Rashnikov.
“This transaction represents another important step forward for MMK to become highly efficient vertically integrated international metals and mining company,” added Rashnikov.
Flinders’ Board of Directors has unanimously recommended that all Flinders shareholders vote in favor of the acquisition. The transaction is subject to regulatory approvals in Australia and is expected to close in March 2012.
Flinders Mines Limited is an S&P/ASX 300 pure-play iron ore company. Its flagship asset, the Pilbara Iron Ore Project is located in the West Pilbara region of Western Australia and is within close proximity of existing and proposed infrastructure. Flinders is targeting production from the Pilbara Iron Ore Project by early 2015. Flinders’ secondary project, Canegrass, is located in the Mid West region of Western Australia.
MMK is among the world's largest steel producers and is one of the leaders of Russia's steel industry. The company's operations in Russia include a large steel-producing complex encompassing the entire production chain, from preparation of iron ore to downstream processing of rolled steel. MMK manufactures a broad range of steel products with a predominant share of higher value added products. In 2010 the company produced 11.4 million tonnes of crude steel and 10.4 million tonnes of commercial steel products, and reported revenues of USD 7.719 billion, EBITDA of USD 1.606 billion, and profit of USD 232 million.
Flinders Mines Limited is an S&P/ASX 300 pure-play iron ore company. Its flagship asset, the Pilbara Iron Ore Project is located in the West Pilbara region of Western Australia and is within close proximity of existing and proposed infrastructure. Flinders is targeting production from the Pilbara Iron Ore Project by early 2015. Flinders’ secondary project, Canegrass, is located in the Mid West region of Western Australia.
MMK is among the world's largest steel producers and is one of the leaders of Russia's steel industry. The company's operations in Russia include a large steel-producing complex encompassing the entire production chain, from preparation of iron ore to downstream processing of rolled steel. MMK manufactures a broad range of steel products with a predominant share of higher value added products. In 2010 the company produced 11.4 million tonnes of crude steel and 10.4 million tonnes of commercial steel products, and reported revenues of USD 7.719 billion, EBITDA of USD 1.606 billion, and profit of USD 232 million.
