Toronto-based North American Palladium on Monday presented shareholders with a $1 billion buyout proposal from a larger South African rival just as its namesake metal touches record high prices.
Under the deal, Johannesburg-based Impala Platinum Holdings Ltd. struck an agreement to pay the private equity firm Brookfield Business Partners $570 million for its 81 per cent stake in the company, or $16 per share.
Meanwhile, it is offering $19.74 per share to minority shareholders, which the company called a 15 per cent premium on the 30-day weighted average price, but was exactly the price the stock closed at on Friday.
North American Palladium’s main asset is an underground palladium mine in northwestern Ontario and it has been riding a wave of investor excitement around the metal, which is used in catalytic convertors to control vehicle emissions.
Even as global auto sales slide, a perceived shift toward tighter emission standards helped palladium prices reach a record US$1,600 per ounce in September — even more expensive than gold.