Aditya Birla sweetens Northern Iron offer to $532 mn

Aditya Birla Group has sweetened a takeover offer for Australia's Northern Iron by about 4 percent to A$518 million (approximately $532 million), two months after an earlier attempt was rebuffed.

The latest A$1.40 per share offer, a 75 percent premium to Northern Iron's closing stock price on Monday, will be considered by the iron ore miner's board and a decision made within a week, the Australian firm said in a statement.

Aditya Birla Group had in May proposed to offer between A$1.28 and A$1.35 a share, which Northern Iron said failed to reflect the improvements in quality and production rates that it expects to achieve at its iron-ore mines in Norway.

 

Northern Iron, however, later said it would allow limited due-diligence to facilitate a higher offer from the Indian group.

Aditya Birla Group's offer comes at a time debt-hungry Indian companies shirk away from deals, hurt by weak markets. Overseas acquisitions by Indian companies dipped by 55.5 percent year-on-year to $2.4 billion in the first half of 2012, according to Thomson Reuters data.

Aditya Birla Group's latest offer, made after the close of trade on Monday, assumes a net debt of A$90 million for Northern Iron and nil dividend from May 2012, the Australian firm said.

Northern Iron shares closed at A$0.8 on Monday and have fallen nearly a fifth since end of May.