May 27, 2010 - Iron ore producer Cliffs Natural Resources Inc. said Tuesday that a subsidiary launched an offer of $82 million (Canadian $86 million) for Canada's Spider Resources Inc., the latest step in a battle among three companies over a chromite mine in Canada.
Cliffs said the price represented a 62.5 percent premium over Spider's closing stock price on May 21, the day before Cliffs' bid was disclosed.
Cliffs is trying to buy Spider and KWG Resources Inc., its partners in the Big Daddy chromite project in Canada. Chromite is used in stainless steel. Cliffs has the largest share in the project, at 47 percent, but Spider and KWG have agreed to merge, which would make them the majority player in Big Daddy.
Cleveland-based Cliffs is bidding 12.4 cents (13 cents Canadian) per share of Spider and the same price for KWG.
The bid for Spider expires July 6 but could be extended. Cliffs said there is no financing condition to its offer, and it doesn't depend on Cliffs acquiring KWG.
Cliffs owns or manages iron ore mines in the northern United States and Canada and produces iron ore pellets. It also has coking coal operations in West Virginia and Alabama and iron ore mining facilities in Australia and Brazil.
In morning trading, Cliffs shares fell $2.35, or 4.2 percent, to $53.51 in morning trading.
