Mining group Xstrata has announced that it has made a bid for Eland Platinum Holdings.

The firm has offered $1 billion for the platinum mining junior and secured irrevocable undertakings of support from 51 per cent of the shareholders, Xstrata said in a statement.

Under the terms of the proposed deal, Xstrata will pay a cash consideration of around $1 billion, which the firm says represents an 18 per cent premium on the share price of Eland as of April 11th 2007.

As part of the agreement, Xstrata will also take a nine per cent stake in the Elandsfontein project, for an additional consideration of $14 million. Xstrata believes this project has good growth capability and appears to be looking to make it the flagship platinum group metal (pgm) project of its mining efforts.

The company has been looking to build up its position in the pgm mining sector for some time and this acquisition would allow it to gain some leverage in the industry.

Source:
Xstrata Alloys announces offer for Eland Platinum Holdings Limited, 7/08/07
http://www.xstrata.com/media/news/2007/08/07/0701CET/
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