- Noranda Income Fund (NIF.UN) has agreed to increase the price for the acquisition of its priority units to $74.2 million and amended the agreement
- The increased purchase price of units exceeds the original valuation range
- Also, the amending agreement with Glencore was unanimously approved by the fund’s board but is still subject to other conditions
- Aside from the price increase, all other terms and conditions of the original arrangement agreement are otherwise unchanged
- Noranda Income Fund (NIF.UN) is up 35.42 per cent, trading at $1.95 per share as of 12:24 p.m. EST
Noranda Income Fund (NIF.UN) agreed to increase the purchase price for the acquisition of all its priority units to $74.2 million and amended the transaction’s agreement.
According to the company, this increase represents a 102 per cent premium on Noranda’s closing price from its last trading day before announcing the acquisition. Likewise, the increase is a 126 per cent premium on the 20-day volume weighted average price per priority unit from the same day.
Before signing the original arrangement agreement, an independent valuation was given to the Independent Committee of the Board of Trustees of Noranda Operating Trust, which set out the original pricing. The increased purchase price of $1.98 per unit exceeds the top end of this valuation range.
Amendment made to include new price
As a result of the price change, an amending agreement with Glencore was unanimously approved by the fund’s board. Certain board members who are related to the fund’s investor company, Glencore, withheld from voting.
The amendment is still subject to the supporting unitholders complying with certain obligations and agreements. Aside from the price increase, all other terms and conditions of the original arrangement agreement are otherwise unchanged.
Anthony Lloyd, Chair of the Noranda Board and member of the independent committee, commented,
“The amending agreement provides fund unitholders with a meaningful price enhancement on what was already an opportunity to unlock an immediate and attractive premium for their units and, accordingly, the arrangement continues to be unanimously recommended by the board and its independent committee.”
Noranda Income Fund (NIF.UN) is up 35.42 per cent, trading at $1.95 per share as of 12:24 p.m. EST.