Gina Rinehart just gave Atlas shareholders a big incentive to sell
Australia’s richest woman, Gina Rinehart, has put more money on the table to entice Atlas Iron shareholders to sell out.
Atlas revealed this morning that Hancock Prospecting subsidiary Redstone Corporation would increase its 4.2c-per-share all-cash offer to 4.6c if it reached a stake of 87 per cent.
The news sent shares up nearly 5 per cent to an intra-day high of 4.4c on Wednesday morning.
The new offer values Atlas at about $442.5 million, compared to $390 million initially, based on the number of shares currently on issue.
The suitor has so far reached 77.06 per cent since the deal was announced over three months ago.
If Hancock reaches its target, shareholders who have already accepted the deal will also receive the higher offer price.
Atlas backed out of a “friendly” tie-up with Mineral Resources (ASX:MIN) after news of Hancock’s offer emerged.
The struggling iron ore producer is feeling the pinch of market conditions, booking a $162.9 million FY18 loss.
Atlas is remaining tight lipped until after the deal has closed.