IGO has acquired Western Areas and added some of the highest-grade nickel mines in Australia to its portfolio.
The major miner acquired 100 per cent of Western Areas via a scheme implementation deed (SID) for $3.36 per Western Areas share, valuing the company at $1.096 billion.
The Western Areas board has given its unanimous support to the takeover and it recommends its shareholders vote in favour of the offer, in the absence of any superior proposal and subject to approvals.
Perpetual Limited, which currently owns 14.7 per cent of Western Areas shares, has said it will also support the bid.
IGO managing director and chief executive officer Peter Bradford said the deal continues the company’s nickel evolution.
“IGO’s acquisition of WSA (Western Areas Limited) is a logical consolidation within the Western Australian nickel landscape and further positions us on our journey to become a globally relevant supplier of metals critical for enabling a clean energy future,” he said.
Nickel is a key part of the world’s clean energy revolution and is essential to electric vehicle manufacturing.
As part of the transaction, IGO will control the Forrestania mine in Western Australia, one of the country’s highest-grade nickel mines.
Western Areas also owns the Cosmos nickel operation in WA where it is currently developing its Odysseus mine, which is on track to deliver first concentrate in the December quarter of 2022.
“Both Forrestania and Cosmos are high-grade, low-cost nickel sulphide operations and this acquisition, together with our existing world class Nova nickel-copper-cobalt operation, will consolidate our position as Australia’s leading independent nickel producer,” Bradford said.
“The unique synergies that will be unlocked across a combined Western Australian nickel hub, combined with the potential downstream optionality that this transaction brings, is expected to generate substantial value for IGO shareholders over the long term.”
IGO hope to complete the transaction in April 2022.