Noranda clears late hurdle to win (May 16, 2005)

Noranda‘s (NRD-T) tender offer for Falconbridge (FL-T) has netted nearly 58.5 million shares, or 78% of the shares held by minority shareholders.

As a result, Noranda’s stake in Falco has increased to 91%; Noranda plans to acquire the remaining shares not tendered to its offer by the end of August. Following the merger of the two companies, Brascan (BNN.A-T), which owns 41% of Noranda’s common shares, will own about 20% of the new NorandaFalconbridge.

In March, Noranda, which already owned 58.5% of Falconbridge, offered 1.77 of its own shares for each Falco share. More recently, the bid survived a last-minute appeal by Wisconsin-based hedge fund Stark Investments to have the Ontario Securities Commission hold a hearing on Noranda’s offer.

Stark also wanted the OSC to order Falconbridge to obtain a new fairness opinion and issue a new circular to shareholders. Stark, which said it has “significant” holdings in Falco, argued that the existing fairness opinion was undervalued by about $4 per share.

The OSC denied the request for a hearing on the grounds that it would not be fair or in the public interest, especially on such short notice.