Gina Rinehart wins battle for Atlas Iron

We’re sorry, this feature is currently unavailable. We’re working to restore it. Please try again later.

Advertisement

This was published 5 years ago

Gina Rinehart wins battle for Atlas Iron

By Darren Gray

Gina Rinehart has taken control of Atlas Iron, knocking out her rival Andrew Forrest after the two battled over the struggling junior miner.

Mrs Rinehart's company Redstone announced over the weekend it had taken a 56 per cent controlling stake in Atlas, and confirmed the all-cash offer for shares in Atlas would be extended to August 17.

And on Monday Mr Forrest’s Fortescue Metals Group lowered its stake in the iron ore miner from 19.9 per cent to 11.37 per cent.

Gina Rinehart's Hancock Prospecting achieves control of Atlas Iron.

Gina Rinehart's Hancock Prospecting achieves control of Atlas Iron.

But with Fortescue's stake in Atlas bigger than 10 per cent, Fortescue's holding means that Redstone cannot automatically acquire outstanding shares in Atlas.

“Fortescue has considered its options with regard to the 19.9 per cent shareholding in Atlas Iron and has decided to retain a substantial shareholding for strategic reasons reflecting our confidence in the long-term fundamentals of the iron ore sector in the Pilbara,” Fortescue chief executive Elizabeth Gaines said.

It comes just days after Ms Gaines told journalists that Fortescue's 19.9 per cent stake in Atlas gave FMG "a seat at the table".

Loading

In a statement released by Gina Rinehart’s Hancock Prospecting over the weekend, Hancock said Redstone’s relevant interests in Atlas had now reached 56.07 per cent, “providing Hancock with effective control of the company”.

Chief executive Garry Korte urged all of the remaining shareholders in Atlas to accept the offer before its scheduled close.

Advertisement

“We are delighted that our offer has been endorsed by acceptances from the majority of Atlas shareholders," he said.

Mr Korte said Hancock was looking forward to working with Atlas, as well as associated contractors and stakeholders, “once we commence our strategic review of the Atlas business following the completion of our offer”.

Atlas Iron is a struggling junior iron ore miner that had a relatively low profile until a few months ago, when the company Mineral Resources emerged with a proposal to join the two companies together.

While that move drew some eyes to Atlas, whose shares closed at just 1.9 cents on April 4, it was the subsequent battle between Mrs Rinehart and Mr Forrest that caught peoples' attention.

Shares in Atlas closed steady at 4.2 cents on Monday, while shares in Fortescue rose four cents to close at $4.34.

Most Viewed in Business

Loading