Nov. 20, 2014, 6:28 PM
- Nevsun Resouces (NYSEMKT:NSU) has emerged as a potential takeover target, and Financial Post's Peter Koven sees many positive factors to explain the interest and one big negative: Eritrea.
- NSU’s Bisha mine is extremely rich, with high-grade copper output that will transition into high-grade zinc output in coming years when many analysts expect shortages in the zinc market.
- But the downside is that Bisha is in Eritrea, which is ruled by one of the world’s most repressive governments and has caused major problems for the company.
- If a contested takeover battle is going to happen, analysts say offers would have to come from companies - perhaps Glencore (OTCPK:GLCNF, OTCPK:GLNCY) or Lundin Mining (OTCPK:LUNMF, LUNCF]]) - that are very comfortable in high-risk jurisdictions.
Nov. 20, 2014, 12:58 PM
- Nevsun Resources (NSU +8%) says it has held preliminary talks with “various parties" about a potential transaction, but that is unaware of any bid for the company.
- NSU rose as much as 25% earlier this morning, leading to a trading halt, after Bloomberg reported that mining fund QKR Corp. was talking to the company about a potential takeover.
Nov. 20, 2014, 10:14 AM
- Nevsun Resources (NSU +13.3%) spikes higher after a Bloomberg report says Qatar-backed QKR Corp. is close to making a ~$1B bid for the Canadian miner, which owns 60% of the Bisha gold, copper and zinc mine in Eritrea in east Africa.
- NSU would be the second acquisition by QKR, funded by Qatar’s sovereign wealth fund and Poland’s richest man Jan Kulczyk, after its July purchase of AngloGold Ashanti's Navachab mine in Namibia.
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