Murchison can’t explain unusual trading
July 4, 2008
July 4th (News.com.au) – IRON ore miner Murchison Metals has advised the Australian stock exchange (ASX) that it cannot explain some unusual trading in its shares in the past week.
The company’s share price has been volatile of late, sinking 13.24 per cent on June 30 to $2.95 from $3.40 on the previous day, then rising 6.78 per cent to $3.15 on July 1.
Murchison said it continued to work on its proposed merger with fellow iron ore miner Midwest Corporation.
This is being threatened by rival bidder Sinosteel’s unconditional, $6.38 per share or $1.36 billion offer for Midwest, which has seen the Chinese steel maker amass a stake of about 44 per cent in its target.
Murchison noted that despite recent share price movements, there had been no change to Midwest’s announcement on June 6, which Murchison said confirmed it believed that Murchison’s offer represented a superior transaction, with the potential to deliver value materially above $6.38 per share.
“Murchison intends to continue to progress the merger proposal until such time as it becomes evident that a majority of Midwest shareholders do not want the merger proposal to proceed.”
Murchison’s shares were four cents higher at $3.00 at 12.33pm AEST while Midwest’s shares were one cent higher at $6.39.