Murchison Midwest merger off the table

The planned Murchison and Midwest merger has been put to rest after months of negotiations and stalled meetings. The two ore giants of Western Australia’s mid-west region could not reach an agreed share value, however both companies conceded the deal would have been beneficial if it had gone ahead. The deal will officially expire at the close of business today (February 6). Murchison Executive Chairman Paul Kopejtka said the deal was called off because the two companies could not agree on a reasonable share price that would benefit all shareholders. &#8220We remain of the view that a merger of Midwest and Murchison is a compelling proposition that would generate significant value for Midwest shareholders,&#8221 Mr Kopejtka said. &#8220Jack Hills and Weld Range remain highly complementary projects that have similar ore types.&#8221 &#8220[The mines&#93 are located in the same geographic region, have similar development timetables and will rely on the same rail and port infrastructure,&#8221 he said. The chief executive of Midwest Bryan Oliver told the Sydney Morning Herald he also thought merging with Murchison made sense. "The only issue has always been relative value between the two parties," Mr Oliver said. One of the more attractive prospects for the proposed merger was the common interest in infrastructure both companies shared. Mr Kopejtka said the merger of the two companies could have avoided the need for a contestable process to award the right to construct a new mid-west port and rail line. The merger would have significantly lowered the cost of building the infrastructure needed for both businesses to operate. &#8220However, without the support of the board and major shareholders of Midwest there is little point in keeping our offer open,&#8221 Mr Kopejtka said. Only 2.01 per cent of Midwest shareholders approved of the offer. Murchison had offered Midwest one share for every 1.08 Midwest shares, however Midwest reject the deal because it felt its shares were, at least, of equal value to those of Murchison. Murchison shares closed 2c higher at $3.98, while Midwest closed 17c lower at $4.95.

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