TORONTO (Reuters) – Lundin Mining Corp (LUN.TO) launched a hostile C$1.4 billion ($1.1 billion) takeover bid for fellow Canadian miner Nevsun Resources Ltd (NSU.TO) on Thursday, saying it had failed to convince Nevsun’s board to strike a friendly deal over the past nine months.
In a direct pitch to Nevsun shareholders for its C$4.75 a share offer, cash-rich Lundin said in a circular it became apparent over time that Nevsun management was unlikely to agree to a transaction, despite multiple attempts to address its concerns.
“Each time we presented a proposal, the goal post changed,” said outgoing Lundin CEO Paul Conibear on a conference call Thursday. After markets closed on Wednesday, Lundin unexpectedly said that 61-year-old Conibear would retire at year-end and be replaced by the company’s chief financial officer.
The announcement of a new CEO on the eve of launching its hostile bid may suggest there is internal debate at Lundin around the deal, said Adrian Day Asset Management, Nevsun’s tenth-biggest shareholder.
“It can’t help but raise questions whether Mr. Conibear, who by no means is an elderly man, is on board with the acquisition,” said Adrian Day, whose fund holds about 3.3 million shares.