A transaction valued at about $225 million will enable Noranda (TSE) to acquire all the publicly held shares of its 63%-owned subsidiary, Brunswick Mining & Smelting (TSE).
Noranda will issue half a Noranda common share for each common share of Brunswick. In addition, it is proposed that Brunswick pay a special dividend of 65 cents per share to its shareholders, if the Noranda bid is successful.
According to Noranda, the bid provides good value for Brunswick shareholders, adding a 40% premium to Brunswick’s recent trading price. In addition, the transaction will enable Noranda to integrate the operations of Brunswick with those of Noranda’s mining group.
Noranda has already entered an agreement with the Irving group of companies. Irving, which owns a 20% interest in Brunswick, has agreed to tender its shares to Noranda’s offer.
Brunswick’s board of directors will be asked to form an independent committee to review the transaction on behalf of the minority shareholders, who own the remaining 17%. The offer is expected to be concluded by early August.
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