02/04/2008 - 22:00

Aquila a target

02/04/2008 - 22:00

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Como-based mining company, Aquila Resources Ltd, could be the target of takeover activity by its joint venture partner, private equity group AMCI, following recent share acquisitions in Aquila and three related iron ore explorers.

Como-based mining company, Aquila Resources Ltd, could be the target of takeover activity by its joint venture partner, private equity group AMCI, following recent share acquisitions in Aquila and three related iron ore explorers.

AMCI’s recent increase in its stake in Red Hill Iron Ltd to 17.8 per cent looks to be the latest chess move by the American group in the complicated, and now strained, relationship between the JV partners.

The tension stems from a continuing legal stoush started early last year when Brazilian company Vale bought AMCI’s Australian coal assets, several of which were under a JV with Aquila.

Aquila has argued in court that the restructure resulted in a change in control under the agreements, which triggered an option for it to acquire AMCI’s interest in the coal and iron ore projects, which are jointly held under the Australian Premium Iron (API) JV.

The iron projects are held by API in separate joint ventures with Red Hill, Cullen Resources Ltd and Helix Resources Ltd.

Separately, AMCI could launch its own play for the iron ore companies, after acquiring between 8 per cent and 18 per cent of each.

However Aquila also has a direct stake in each company, and could block AMCI.

If a takeover was launched by either AMCI or Aquila, the bidder would have to offer half of its newly acquired tenements to its JV partner, as part of the API agreement.

Meanwhile, Aquila executive chairman Anthony Poli said AMCI had bought a further 0.5 per cent of Aquila shares over the past couple of weeks, adding to its 8.3 per cent stake.

Adding fuel to the possible takeover fire is the recent request by AMCI for Aquila’s share register, which Mr Poli said has been followed by AMCI contacting some Aquila shareholders.

Mr Poli added that AMCI had so far not told Aquila its reason behind the calls or the request for the share register, but said AMCI’s actions looked to be the makings of a takeover.

“[Aquila is] not vehemently opposed to any takeover, but we certainly would be striving to get an attractive offer for shareholders, reflecting the full value of the suite of assets that we have and the potential for those assets,” Mr Poli said.

When contacted by WA Business News, a representative said AMCI was currently not commenting to the media.

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