Metorex Shareholders To Vote On Vale Takeover Offer July 22

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By Diana Kinch

Published June 15, 2011


RIO DE JANEIRO -(Dow Jones)- Shareholders of South Africa-based copper and cobalt producer Metorex Ltd. (MTX.JO) will vote on a takeover offer from Brazilian mining giant Vale SA (VALE5.BR, VALE) on July 22, Metorex said in a statement Wednesday.

Prior to the vote, a circular will be distributed to Metorex shareholders on June 17 with details of the proposed takeover by Vale, Metorex Chairman Rob Still said in the statement posted on the corporate website after the company's annual general meeting.

Vale in early April made an offer to buy Metorex for about $1.13 billion in a deal that requires approval of 75% of Metorex's shareholders. An agreement struck last week by which Metorex will sell its zinc-processing plant in Zambia to Glencore International PLC (GLEN.LN) paves the way to completion of the takeover deal, as Vale had said it wasn't interested in that plant.

If Vale concludes the purchase of Metorex, it will inch closer to its long-term copper production target of 1 million metric tons a year.

In 2010, Metorex produced 51,569 metric tons of copper and 3,622 metric tons of cobalt, and its existing mines have estimated copper reserves of over 25 million tons of copper. The company, which also has three further projects in Congo, posted gross revenue of $432 million and ended last year with net debt of $63 million.

After gaining the approval of Metorex shareholders, the proposed Vale takeover will still need to be approved by regulatory bodies in South Africa, Zambia and Congo.

In April, Vale said it already had confirmed support for the takeover from Metorex shareholders holding 25.4% of the existing issued ordinary shares.

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