26 Mar Wesfarmers makes $1.5 billion bid for rare earths miner Lynas Corp
Wesfarmers has made a surprise AUS$1.5 billion offer to buy Lynas Corp, an ASX-listed rare earths producer that is currently embroiled in a regulatory dispute with Malaysian authorities.
The Australian conglomerate’s $2.25 per share all-cash offer represents a 44.7% premium to Lynas’s closing share price on Monday, and is the first acquisition attempt by Wesfarmers since Rob Scott’s appointment as managing director in 2017.
“An investment in Lynas leverages our unique assets and capabilities, including in chemical processing, and will deliver Lynas shareholders with an attractive premium and certain cash return,” said Scott after the bid was submitted to the ASX.
However, Wesfarmers shares dropped 3.5% in the wake of the bid with investors indicating concern around Lynas’s rare earths processing plant in Malaysia, after authorities ordered the miner to export all radioactive waste stored at the plant by September.
Lynas is in talks with the Malaysian government and is hopeful a solution can be found. Meanwhile, Wesfarmers said its offer was conditional on Lynas securing the relevant operating licences in Malaysia.