Lundin Mining Corporation, which lost almost half its value after spurning two takeover bids now needs an acquirer willing to pay the biggest premium for a diversified minerals deal to make shareholders whole again.

The copper producer’s market capitalization has plunged CAD 2.2 billion or 42% in about four months since rejecting CAD 4.8 billion bid from Equinox Minerals Limited and abandoning plans to sell itself after deeming offers to be inadequate. To recover the losses, Lundin would now have to find a buyer willing to pay 71% takeover premium making it the most expensive diversified minerals deal greater than USD 500 million.

While bidders may still be lured by Lundin’s stake in a copper mine in the Democratic Republic of Congo and a valuation cheaper than 97% of the Toronto based company’s rivals, Chairman Lukas Lundin may insist on a price exceeding Equinox’s prior offer.

According to Stifel Nicolaus & Company, Potential suitors now must weigh a 17% slump in copper prices and increasing signs the US may fall back into a recession as stocks suffer the worst slump since the financial crisis.

Mr George Topping Toronto based analyst at Stifel said that “It was a complete debacle when they rejected the Equinox bid and failed to find any alternative bids. With the hindsight of the current market and current share prices, they should’ve done that one and moved on.”

(Sourced from Bloomberg)