Independence Offers A$1.8 B for Sirius, Australian Indexes Advance

Marcus Jacob
25 May, 2015
New York City

Australian market indexes closed higher on Merger Monday. Independence offered to acquire Nickel miner Sirius Resources for $1.8 billion and said it will spin-off the merged asset as a new company.

[R]5:30 PM Sydney – Australian market indexes closed higher on Merger Monday. Independence offered to acquire Nickel miner Sirius Resources for $1.8 billion and said it will spin-off the merged asset as a new company.[/R]

Australian market indexes gained in thin trading and domestic deal news overshadowed market sentiment.

Australian dollar closed at 78.29 U.S. cents and in stock trading turnover declined to 556 million shares worth $3.7 billion.

At close, the ASX 200 Index climbed 56.80 or 1% to 5,721.50 and the broader All Ordinaries Index jumped 51.70 to 5,719.90.

In commodities trading, gold fell US$4 to US$1,205 an ounce and Brent crude edged up 0.01 cents to close at US$65.38 a barrel.

Australian Stock Movers

Evolution Mining Limited closed unchanged at $1.17 after the gold producer agreed to acquire Cowal gold mine in central New South Wales for about $703.7 million or US$550 million from Canada-based Barrick Gold Corporation.

Independence Group NL tumbled 12% to $5.15 after the nickel, copper and zinc explorer agreed to acquire nickel miner Sirius Resources for $1.8 billion.

Independence will spin-off its nickel mining business with some Scandinavian exploration assets as a separate company S2 Resources Limited.

Perth-based Sirius is constructing its nickle mine in Western Australia and the production is expected to begin in 2017. The company was worth only $8 million when it announced the discovery of nickle in July 2012.

Independence offered 0.66 of its own shares in exchange for each Sirius stock and 52 Australian cents a share in cash.

Independence Group offered Sirius $4.38 per share that represents a 35% premium to its latest closing price of $3.24.

Shares of Sirius Resources N.L. surged 20.4% to $3.90.

Skilled Group Ltd soared 11.8% to $1.38 after the workforce solutions provider’s rival Programmed Maintenance Services Limited offered merger proposal with a price of about $1.49 per share.

Programmed Maintenance Services Limited stock declined 4.2% to $2.51.

Sunland Group Limited dropped 2.2% to $1.78 after the residential property developer agreed to acquire Brisbane-based 6,300 square meter site for a boutique luxury housing development for about $11.1 million.