Sinosteel tightens grip on Midwest Corp

Chinese company Sinosteel Corporation has today emerged with a 70.2 per cent holding in takeover target Midwest Corporation Ltd following yesterday's surprise acceptance by former suitor Murchison Metals Ltd.

In an announcement to the market today, Sinosteel's shareholding in the Mid West iron ore miner jumped from 60.54 per cent to 70.19 per cent.

Late yesterday, Murchison announced it had accepted Sinosteel's $6.38 cash offer for its 9.2 per cent holding in Midwest.

Since its failed takeover attempt for Midwest earlier this year, Murchison has previously said it will not accept Sinosteel's offer however market volatility over the past three months forced a change of heart.

Murchison pocketed $135 million for its shareholding.

US investment fund Harbinger Capital, which has been closely aligned with Murchison, is one of a few major Midwest shareholders to accept.

It is not known what major shareholder and previous Midwest director David Dato Law will do with his 13.2 per cent stake.

Sinosteel's offer is due to close on Monday and will not be extended.