Fortescue acquires majority stake in Red Hawk

Australia’s Fortescue Metals Group has acquired a controlling stake in the mining company Red Hawk. This is reported by Mining.com.

The increase in the stake came after the company’s largest shareholder, Todd Corporation (New Zealand), accepted Fortescue’s offer to buy back shares worth $254 million (A$1.05 per share).

The fourth-largest iron ore producer in the world, through its subsidiary FMG Pilbara, now owns 66.23% of Red Hawk.

Fortescue’s offer includes a provision to increase the purchase price to A$1.2 per share if FMG Pilbara increases its stake to 75% or more within seven days through an off-market takeover bid.

Fortescue’s offer, submitted in January, was aimed at securing access to the undeveloped Blacksmith ore project. Its total mineral resources are currently estimated at 243 million tons with an iron grade of 59.3%.

This acquisition is in line with Fortescue’s broader growth strategy and represents a strategic opportunity to continue the company’s expansion in the metallurgical raw materials sector.

As a reminder, Fortescue shipped 191.6 million tons of ore in the 2023/2024 financial year (ended in June). These volumes are in line with the previous fiscal year and below the estimated range of 192 to 197 million tons.

As GMK Center reported earlier, the Brazilian mining company Vale confirmed that it has bought out 50% of its joint venture Baovale, which was previously owned by its Chinese partner Baosteel. This step gives Vale full control over the iron ore project. The deal still needs to be approved by Brazil’s antitrust agency CADE.