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Xstrata studying Eland Pt Posted: Fri, 15 Jun 2007 [miningmx.com] -- XSTRATA, the UK listed mining firm, is wrapping up a due diligence on Eland Platinum and may decide in weeks whether to table an offer for the Johannesburg listed firm. Another mining diverisfied firm, BHP Billiton, has decided to withdraw its interest in Eland Platinum citing, among other reasons, the prospect of having to go underground. "It is terrified of suffering fatalities on its mines. It's a major reason they decided to withdraw from bidding for Eland," a source said. Xstata CEO, Mick Davis, told Miningmx recently that platinum was a commodity in which the group could potentially become involved. He felt the company was overweight of base metals which comprised more than two-thirds of last financial year's earnings. The prospect that Xstrata was considering investing in Eland Platinum was first identified by Business Report, a South African newspaper. However, reports that no such interest remained took a fifth off Eland Platinum's share price. The stock fell 17% and 8% in successive days earlier this week. However, a source says Xstrata still had about ten of its people positioned on site at Eland Platinum which recently bought the neighbouring Madibeng property which it believes will provide underground extensions to its Elandsfontein property. For its part, Eland Platinum said it continued to trade under a cautionary and said certain media reports, which said before walking away Xstrata had been prepared to offer R70/share for Eland Platinum, contained "material inaccuracies". It could not provide further details. "Eland Platinum Holdings is currently trading under a cautionary announcement and the circumstances which gave rise to this remain," it said in a statement issued shortly after midnight on June 15. "Shareholders are advised that Eland Platinum continues to be engaged in discussions which, if successfully concluded, may have an effect on the price at which the company's shares trade on the JSE," it said. Meanwhile, Eland Platinum said it had requested the JSE to investigate the events surrounding the recent share price volatility of the company's shares on the JSE. Eland shed 21% of its market value this week trading down to R94.51 on June 14 after being at R119.80/earlier. Click Here to subscribe to our daily newsletter
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