Freeport chief confident Phelps Dodge acquisition will go through

Dec 01, 2006 | 07:46 AM | Sean Barry

Freeport-McMoRan Copper & Gold Inc. is confident its $25.9-billion friendly takeover offer for copper producer Phelps Dodge Corp., Phoenix, will be given the go-ahead by shareholders despite speculation that both companies could be the target of third-party bidders.

"We believe the deal we've negotiated is one that is attractive and will be presented to shareholders and approved," said Richard C. Adkerson, president and chief executive officer of New Orleans-based Freeport. "Whether other parties come into the process on an unsolicited basis, only time will tell."

The mining industry has witnessed a wave of third-party bids this year. Attempts by Phelps Dodge to acquire Toronto-based nickel company Inco Ltd. and then enter a three-way merger with Falconbridge Ltd., also based in Toronto, were quashed after it lost out to competing bids by Cia. Vale do Rio Doce (CVRD) and Xstrata Plc.

However, there is a growing consensus that interest from potential bidders is waning and the spread between the terms of the deal and the level of Freeport and Phelps Dodge shares has narrowed, indicating improved confidence among investors, analysts said.....

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