Lonmin grabs control of Southern Platinum

Lonmin‘s (LMI-L) all-cash offer for Southern Platinum (SPC-T) has netted the world’s third-largest platinum producer more than 81 million shares.

The haul represents 82.8% of the Toronto-based junior’s shares on a fully diluted basis, and eclipses the two-thirds acceptance level required for the bid to be declared unconditional.

Lonmin originally launched its offer of $2.66 per share on March 22 (T.N.M., Apr.4-10/05); the bid was extended about a month later to June 10, as the South African Competition Tribunal had yet to approve the transaction.

Tribunal approval arrived on June 8, with the main condition that no more than 284 semi-skilled employees, and 116 management-, artisan-, supervisor- and administrator-level positions be eliminated following the acquisition.

Under the Canadian Companies Act, Lonmin can compulsorily acquire Southern Platinum’s remaining shares only if it receives acceptances from at least 90% of shareholders; the company has extended its offer to June 28.

Lonmin said that if the extended bid fails, it will “proceed with a subsequent acquisition transaction.” If required, the company plans to hold a special meeting of Southern Platinum shareholders to approve the subsequent transaction, on August 9.