Phelps Dodge Supports Inco's Bid for Falconbridge

Phelps Dodge Corp. has announced its full support for Inco Ltd.'s bid to acquire Falconbridge Ltd. This move comes after Xstrata PLC increased its offer for Falconbridge for the second time, to $16.9 billion for the 80% stake it does not already own. Inco's bid, which includes a per-share offer of C$29.77 in cash and 0.3741 of Inco's own shares, has been accepted by Inco's board of directors, and the company has agreed to be acquired by Phelps Dodge.

Key Takeaways:

• Phelps Dodge fully supports Inco Ltd.'s bid to acquire Falconbridge Ltd.
• Xstrata PLC has increased its offer for Falconbridge to $16.9 billion for the 80% stake it does not already own.
• Inco's bid for Falconbridge includes a per-share offer of C$29.77 in cash and 0.3741 of Inco's own shares.
• The acquisition is subject to regulatory approvals and other conditions.
• Phelps Dodge will own 100% of Inco's outstanding shares.
• Inco's board of directors has agreed to be acquired by Phelps Dodge.
• See Figure 1 for Falconbridge's recent stock price performance.

Statistics:

• Inco's bid for Falconbridge is valued at $16.9 billion.
• The bid includes a cash component of $29.77 per share.
• The bid also includes 0.3741 of Inco's own shares per share.
• Xstrata PLC already owns 20% of Falconbridge's outstanding shares.

Sources:

• Dow Jones Commodities News via Comtex
• Inco Limited Annual Report
• Xstrata PLC website
• Falconbridge Ltd. website