As the Inco Ltd. and Falconbridge Ltd. merger awaits regulatory clearances from competition authorities in the United States and Europe, a new suitor for Inco is waiting in the wings.
Teck Cominco Ltd., a mining company based in Vancouver, announced Monday a $17.8 billion takeover bid for Inco. The Teck bid does not include Falconbridge and would depend on the merger falling through.
All figures are in Canadian dollars.
Under the Teck bid, Inco shareholders would be paid $78.50 per share.
In response to the offer, Inco released a statement saying it reviewed the Teck press release and that the board of directors would review the bid once the formal offer is made available.
In the statement released to the media, Inco indicated that it remains committed to its transaction with Falconbridge.
Should the Inco takeover succeed, the new Teck Cominco would boast a market value of approximately $35 billion and would be a leader in zinc, nickel and metallurgical coal.
The Canadian Auto Workers (CAW) union has also released a statement on the Inco bid, urging the government to review the Teck bid.
"Mining executives and investors are chasing hyper-profits being generated by inflated global prices," said CAW president Buzz Hargrove in a statement. "We can't let their short-sighted greed put thousands of mining jobs, and the future of mining communities, at risk."
CAW is calling on the provincial and federal governments to negotiate a formal merger plan with any merged company, which would include a moratorium on mine, mill and smelter closures, purchases of Canadian-produced supplies and services and full recognition of pension and other post-retirement obligations.
