Barrick / Equinox
The scramble among miners for raw materials has heated up the Canadian resource sector, with a handful of big guns trying to outdo each other in a game of one-upmanship.
Barrick Gold Corporation, already the world’s largest gold miner, seems to have taken a shine to copper with a $7.6 billion offer for Equinox Minerals Limited. Both are based in Toronto. Barrick announced the friendly deal with Equinox on April 25.
The deal capped three months of frenzied activity in the resource sector. The churn started on January 12, when Lundin Mining Corporation and Inmet Mining Corporation, both based in Toronto, announced a friendly $9 billion deal to create a new company named Symeterra Corp.
Six weeks later, Equinox made an unsolicited $4.8 billion offer for Lundin, which canceled its agreement with Inmet. Then, on April 3, Minmetals Resources Ltd. announced an unsolicited $6.3 billion offer to buy Equinox. But the company (the Hong Kong unit of Beijing-based China Minmetals Group) had not mailed its bid to Equinox shareholders by the time the Barrick proposal was announced.
Under the latest deal, Equinox will drop its offer for Lundin, a smaller company with copper assets in Congo. Equinox, which is listed in Toronto and Sydney, has key copper assets in Zambia and a development project in Saudi Arabia. Barrick is offering $8.45 a share for Equinox, compared with the $7.23-per-share bid from Minmetals.
For Barrick the deal is the first step in its plan to diversify and join the big leagues with the likes of Anglo-Australian miner Rio Tinto. The deal is the largest of Barrick’s 17 transactions since the 1980s.
For acquiror Barrick Gold Corporation (Toronto)
Ogilvy Renault: M&A: Pierre Dagenais, Terence Dobbin, Paul Fitzgerald, Eric Reither, and associates Matthew Hall, Chris Harris, and Evelyn Li. Mining: Ned Steinman, Dawn Whittaker, and associate Oliver Moore. Tax: Adrienne Oliver and associate Ted Citrome. Regulatory: associate Kevin Ackhurst. Financing: Peter Wiazowski. (All are in Toronto except for Hall and Harris, who are in Calgary; Steinman and Moore, who are in Ottawa; and Wiazowski, who is in Montreal.) Ogilvy Renault has worked with Barrick since 1990. This is the firm’s first public M&A transaction for the company.
Sullivan & Cromwell: M&A: James Morphy and George Sampas. Securities: Donald Crawshaw. Finance: John Estes and Inosi Nyatta. Tax: Ronald Creamer. Antitrust: special counsel Eric Queen and associates Mary Grendell and John Wildt. (They are in New York.) The firm previously advised the company on mining projects in Argentina and Tanzania.
Clayton Utz: M&A: John Elliott and senior associate Adrian Beerworth. Tax: Mark Friezer and senior associate Louisa Wu. (They are in Sydney.)
For target Equinox Minerals limited (Toronto and West Perth, Australia)
Osler, Hoskin & Harcourt: Corporate: Douglas Bryce, Clay Horner, and associates James Brown and Medard Fischer. Tax: Firoz Ahmed, Kim Wharram, and associate Amanda Heale. Banking and financial services: Michael Matheson. (All are in Toronto except for Bryce, who is in New York.) Osler is not regular Canadian counsel to Equinox but represented it on this transaction.
Allen & Overy: Geoff Simpson and Meredith Campion. (They are in Perth.) Allen & Overy has advised Equinox before, most recently on its takeover of Citadel Resources Group.
For failed bidder Minmetals Resources Ltd. (Hong Kong)
Davies Ward Phillips & Vineberg: M&A: Lisa Damiani, Kevin Thomson, and associate Tiffany Jung. Competition: John Bodrug and associate Jim Dinning. (They are in Toronto.) Davies has worked with the senior management team of Minmetals Resources for the last several years in connection with various North American M&A deals. Davies worked with the team when it ran Zinifex Resources, including the acquisition of Wolfden Resources in 2007. He continued to work with the team at OZ Minerals Limited, following its creation through the merger of Zinifex and Oxiana Resources in 2008. The majority of the OZ Minerals management group then moved to Minmetals following its acquisition of the bulk of the assets of OZ Minerals in 2009.
Freehills: John Tivey. (He is in Melbourne.) The firm advised OZ Minerals in 2009 on the $1.4 billion sale of most of its mining interests to China Minmetals Group.
For Lundin Mining Corporation (Toronto)
In-House: Corporate secretary James Ingram.
Cassels Brock: Securities: Mark Bennett, John Craig, and Jeffrey Roy. (They are in Toronto.)
For Lundin special committee
Blake, Cassels & Graydon: M&A: Peter O’Callaghan. Securities: Trisha Robertson. (They are in Vancouver.) The firm has acted as special counsel to Lundin on several previous transactions.
Shearman & Sterling: Capital markets: Jason Lehner and associate Daniel Weber. (They are in Toronto.)
For Inmet Mining Corporation (Toronto)
In-House: Vice president, general counsel, and secretary Steve Astritis.
Torys: Corporate/Securities: Andrew Beck, Christopher Fowles, Peter Jewet, counsel Leslie McCallum, and asso­ciates Victoria Blond and Dean Kotwal. Pension and employment: Peter Keenan and Christina Medland. Competition and antitrust: Jay Holsten. Tax: John Unger and asso­ciate Judah “Ari” Feder. Litigation and dispute resolution: Andrew Gray. Environmental: associate Michael Fortier. Intellectual property/Trademark agent: Joanne Nardi. (All are in Toronto except for Beck and Keenan, who are in New York.)
For Inmet parent Leucadia National Corporation (New York)
Weil, Gotshal & Manges: M&A: Andrea Bernstein. (She is in New York.)
London Stock Exchange / TMX
A $3.2 billion deal announced on February 9 between The London Stock Exchange Group and The TMX Group Inc., parent of the Toronto Stock Exchange, was originally billed as a merger of equals. But after considerable opposition from banks and nervous politicians, the two bourses in early March stopped using that phrase to refer to the deal, and by late April were under fire from a committee of the Ontario legislature to rework the agreement.
Under the original deal, TMX would have had seven of 15 board seats and would have owned 45 percent of the combined company. An all-party committee of the legislature wants the agreement amended to give TMX shareholders an equal number of board seats. On April 19 TMX and the LSE said that they acknowledged the work by the Ontario committee and will review its report in detail.
The committee is worried that the deal is not in Canada’s best interests because majority control of the combined entity would be in London. The committee cannot approve or reject the deal, but its recommendations will become part of a report that the Ontario government will submit to Industry Canada, which will ultimately rule on the deal. Ontario finance minister Dwight Duncan set up the committee to examine the impact of the proposed merger on Toronto’s financial services sector, which employs 300,000, as well as the mining industry in northern Ontario.
For acquiror The London Stock Exchange Group PLC (London)
In-House: General counsel Catherine Johnson.
Freshfields Bruckhaus Deringer: Corporate: Andrew Hutchings and Philip Richards. Tax: Jonathan Cooklin. Employment and share schemes: Jocelyn Mitchell. Competition: Tom Ensign and Simon Priddis . (They are in London.) The LSE is a longtime client of Freshfields.
Osler, Hoskin & Harcourt: Corporate: Jeremy Frailbert, Donald Gilchrest, and Clay Horner. Competition: Peter Franklyn. Tax: Monica Biringer. (They are in Toronto.) Osler was referred to the LSE by Freshfields.
For target The TMX Group Inc. (Toronto)
Torys: M&A: Richard Balfour, Aaron Emes, Sharon Geraghty, James Miller, and associates Morgan Crockett, Catherine De Giusti, Adrienne DiPaolo, and Robbie Liebel. Investment Canada: Omar Wakil and asso­ciate Sue-Anne Fox. Tax: Kathy Moore, James Welkoff, and associate Catrina Card. U.S. securities: Andrew Beck. Antitrust: Jay Romagnoli and associates Mayah Judovits and Craig Pell. Real estate: David Dell. Research: Wilfred Estey. Pension and employment: Mitch Frazer. Intellectual property: Daniel Logan and associate Ebad Rahman. Environmental: Dennis Mahony. (All are in Toronto except for Beck, Romagnoli, Pell, and Judovits, who are in New York.) Torys has represented TMX since 1981.
Allen & Overy: Corporate: Richard Browne, Richard Evans, senior associates Sara Pickersgill and Karolien van Genechten, and associate Louise Baillie. Tax: Christopher Harrison and senior associate Tim Harrop. Antitrust: Simon Pritchard, senior associate Jonathan Parker, and associate Sarah Cragg. (They are in London.)
Consolidated Thompson / Cliffs Natural Resources
Brian Tobin, the chairman of Consolidated Thompson Iron Mines Limited, has long wanted to buy the Wabush iron ore complex in the province of Newfoundland and Labrador and merge it with his company’s nearby Bloom Lake project. But in 2009 Cliffs Natural Resources Inc. bought Wabush instead. Now, in what Tobin—the former premier of Newfoundland and Labrador—says is an ironic but positive deal, Cliffs is acquiring Consolidated in a friendly $4.9 billion transaction announced January 11 .
Consolidated’s biggest shareholder is Wuhan Iron and Steel (Group) Corporation, China’s third-largest steel producer. Wuhan owns 19 percent of the Canadian company, which is based in Montreal. Cliffs is based in Cleveland.
Canada’s minister of industry approved the deal on April 12 on the basis that it is likely to be a net benefit to the country. The transaction must still be approved by China’s Ministry of Commerce. The deal is expected to close in the second quarter.
Industry watchers say the deal indicates that interest is growing among foreign steelmakers in Canada’s iron ore resources. In January the world’s biggest steelmaker, ArcelorMittal, won a bidding war with Nunavut Iron Ore Acquisition Inc. for Toronto-based Baffinland Iron Mines Corp.
For acquiror Cliffs Natural Resources Inc. (Cleveland)
Jones Day: M&A: James Dougherty and Robert Profusek. Banking and finance: Brett Barragate. Capital markets: Michael Solecki. Antitrust: Tom Smith and Peter Wang. (Dougherty and Solecki are in Cleveland; Profusek and Barragate are in New York; Smith is in ­Washington, D.C.; and Wang is in Shanghai.)
Blake, Cassels & Graydon: Securities: Chris Hewat, Sheldon Vanderkooy, and associate Tim Andison. Corporate: Thomas McKee. Competition: Navin Joneja. Tax: Jeffrey Trossman. (All are in Toronto.)
Norton Rose: Corporate: Gary Thomas, senior associate Roger Hawkins, and associates Terri Francis and Andrew Ricciardi. (They are in Perth, Australia.)
For target Consolidated Thompson Iron Mines Limited (Toronto)
In-House: General counsel, corporate secretary, and vice president–legal affairs Valéry Zamuner.
Fraser Milner Casgrain: Mining/Securities: Guy-Paul Allard, Sander Grieve, Linda Misetich, Ralph Shay, Charles Spector, counsel John Sabine, and asso­ciates Liz Fraser, Scott Rozansky, and Giancarlo Salvo. Financial services: Heidi Clark and Barbara Farina. Tax: Zahra Nurmohamed and notary Richard Gauthier. Pension and benefits: associate Mark Dunsmuir. Research: Timothy Banks. Litigation: Robb Heintzman. Competition: Susan Paul and Sandra Walker. (All are in Toronto except for Allard, Farina, Gauthier, Rozansky, Salvo, and Spector, who are in Montreal.)
For Consolidated shareholder Wuhan Iron and Steel (Group) Corporation (Wuhan, China)
In-House: General counsel Liu Xinquan.
McCarthy Tétrault: M&A: Joyce Lee and associate Michael Lee. Mining: Richard Miner. (Joyce Lee is in Vancouver; Michael Lee and Miner are in Toronto.) The firm has represented Wuhan since 2008 in its investments in Canada.
For Consolidated’s transaction committee
Cassels Brock: M&A: Jeffrey Roy, John Vettese, and associate Jay King. (They are in Toronto.)
Newmont / Fronteer
In its first acquisition of 2011, U.S. giant Newmont Mining Corporation decided to go after Canada’s Fronteer Gold Inc. in order to gain exploration and development projects on its home turf. Toronto-based Fronteer Gold owns three projects in Nevada—Long Canyon, North­umberland, and Sandman—that contain a reported 4.2 million ounces of gold. Newmont will spin off Fronteer’s 11 other projects into a new company called Pilot Gold.
The $2.3 billion acquisition closed on April 6, a little more than two months after Fronteer shareholders approved it. Analysts said the deal also made sense because it will present significant cost savings.
For acquiror Newmont Mining Corporation (Denver)
In-House: Vice president and general counsel Stephen Gottesfeld, vice president and secretary Jeffrey Reeser, and assistant general counsel Logan Hennessey.
Goodmans: Corporate/M&A: Jonathan Lampe, Neill May, David Redford, and associates Alex Bayer, Gail Jaffe, Robert Kallio, Stacey Kline, and Chris Sunstrum. Tax: Alan Bowman, Carrie Smit, and Mark Tozer. Competition: Richard Annan. Regulatory: Bob Vaux. Litigation: Tom Friedland. (All are in Toronto except for Bayer and Redford, who are in Vancouver.) Goodmans and Wachtell have advised Newmont in connection with numerous acquisitions and financings, including Newmont’s $4.4 billion concurrent acquisitions of Australia’s Normandy Mining and Canada’s Franco-Nevada Corporation in 2002, its $1.5 billion acquisition of Canada’s Miramar Mining Corporation in 2008, and its $1.2 billion IPO for subsidiary Franco-Nevada in 2007.
Wachtell, Lipton, Rosen & Katz: Corporate/M&A: David Katz and associate DongJu Song. Tax: Deborah Paul and Michael Sabbah. Antitrust: Ilene Gotts. Litigation: Eric Roth. (All are in New York.)
For target Fronteer Gold Inc. (Vancouver)
Davies Ward Phillips & Vineberg: M&A: Richard Fridman, Melanie Shishler, Kevin Thomson, and associates Bradley Ashkin, Joshua Kuretzky, and Anthony Spadaro. Tax: Christopher Anderson, Ian Crosby, and Elie Roth. Securities: Abraham Leitner. Competition: John Bodrug. Pension and benefits: Natasha Vandenhoven. (All are in Toronto except for Leitner, who is in New York.) Davies has represented Fronteer since late 2008 after representing the special committee of Fronteer in connection with the acquisition of Aurora Energy Resources Inc.
Troutman Sanders: Stuart Pierson, Mitchell Portnoy, and Thomas Rose. (Pierson is in Washington, D.C.; Portnoy is in New York; and Rose is in Virginia Beach.)
Davis Graham & Stubbs: Mining: Randall Hubbard. (He is in Denver.)
Lawson Lundell: Khaled Abdel-Barr, Chris Baldwin, and associates David Gedge, Jennifer Nyland, and Suzanne Woolley. (They are in Vancouver.) The firm was counsel for British Columbia to Fronteer and Newmont.
Benson Myles: M&A/Mineral law: Paul Dicks and associate Jennifer Gorman. (They are in St. John’s, Newfoundland and Labrador.) The firm served as special counsel for Newfoundland and Labrador.
For more international news, go to law.com/international
All values in this article are in U.S. dollars.