Lonmin boosted by £5bn takeover bid from mining firm

Aug 7 2008 Daily Record

PLATINUM producers Lonmin's shares soared almost 50 per cent yesterday after a £5billion takeover offer.

The bid for Lonmin, the world's third - largest producer of platinum, came from Anglo-Swiss mining company Xstrata.

Xstrata bid £33 per Lonmin share, 42 per cent over their £23.19 Tuesday closing price, but Lonmin said the approach was "opportunistic and entirely unwelcome".

The offer caused Lonmin shares to jump 47 per cent to £34.07 - above the offer price - while the rest of the mining sector was also higher and Xstrata shares were three per cent stronger.

Xstrata said the Lonmin business had been affected by a number of operational difficulties over the past two years, including below budget production at a time of robust platinum prices.

But Lonmin urged their shareholders to take no action.

Stockbrokers Seymour Pierce said Xstrata already had a sizeable business in South Africa with experience of mining on the Bushveld, where most of Lonmin's mines are.