Sirius Minerals accepts Anglo American offer 05 Mar 2020

The proposed takeover of Sirius Minerals by Anglo American has been approved in a vote by shareholders. A majority of investors backed the £405 million rescue bid at a meeting in London on 3 March 2020, in an effort to save the company from administration.

Polyhalite project moves closer to completion

Requiring a majority of individual shareholders to vote in favour of the deal, the vote won 62% support; and requiring 75% approval of shares by value, received 80% support.

The vote comes after Sirius Minerals failed to raise the finance it required from bond investors at the end of 2019 to complete its Woodsmith Mine project in North Yorkshire, UK. After already spending more than US$1 billion on the polyhalite mine, Sirius Minerals was offered a lifeline from mining giant Anglo American in January 2020, albeit at a much lower share capital value than the Board and investors had hoped.

Shareholders were asked to vote in favour of the Anglo American offer of 5.5p per share, despite many standing to make a significant financial loss after buying into the company at up to 25p per share. However, the Sirius Board warned investors that they risked losing their entire investment if they did not support the takeover, as the only likely alternative to the deal was that Sirius would collapse into administration by the end of March 2020.

Russell Scrimshaw, Chairman of Sirius, said: “The positive outcome from the meeting secures a return for shareholders, and provides greater certainty in terms of safeguarding the project, protecting the jobs of our employees, and allowing the community, region and the UK to continue to benefit from the project.”

The deal remains subject to the sanction of the court at a hearing due to be held on 13 March 2020, after which the takeover is expected to be effective as of 16 March 2020.