Shareholders get top dollar as Falconbridge sale unfolds

It was no secret that Alf Powis and Noranda Inc. (TSE) wanted Falconbridge Ltd. Noranda had been foiled once before in a takeover bid for the free world’s second largest nickel producer and its lucrative Kidd Creek mine.

So it was a surprise to many when New York-based Amax Inc. (NYSE) made a $2.8-billion bid for Falconbridge in August by offering $36.125 for outstanding shares (N.M., Aug 7/89).

When Bill James, then chairman of Falconbridge, recommended the offer be accepted, nationalists cried foul. Ontario Premier David Peterson vowed to “scour the books” in search of ways to keep control of the company from going south.

In the end, however, it was Alf Powis who kept Falconbridge a Canadian company. With the help of Trelleborg AB, a Swedish base metals miner, Noranda upped the bid to $37 per share. Since Noranda already held 23.8% of Falconbrid ge’s shares (and a 27% voting interest), Amax knew it was beat and didn’t pursue the deal. In September, Noranda became Kidd Creek’s new owner (N.M., Sept 11/89).

Alex Balogh, a former head of Noranda’s copper division, replaced Bill James as chairman although James retained a seat on the board of directors.

In 1988 Falconbridge enjoyed record profits of $341 million.