Rio Tinto launches bid for Hathor

RIO Tinto has made a C$578m (£361.6m) friendly takeover offer for Canadian uranium explorer Hathor Exploration in a move to thwart Cameco Corp’s hostile bid.

Hathor’s board has recommended shareholders accept Rio Tinto’s all cash bid at C$4.15 per share, which is higher than Cameco’s offer of C$3.75 a share.

At stake is Hathor’s Roughrider deposit, a uranium project located near Cameco’s Rabbit Lake mill in the Athabasca Basin of the Canadian province of Saskatchewan.

Shares of Hathor were halted on Wednesday morning on the Toronto Stock Exchange. Shares of Cameco, Canada’s largest uranium producer, dropped 2.88 per cent to C$20.88.

Cameco launched its hostile bid for the uranium exploration company in late August, after talks aimed at a friendly deal failed.

Hathor said Cameco’s C$3.75 a share offer was financially inadequate and failed to ascribe value to Roughrider and to its other assets, including its Russell Lake property in the southeastern Athabasca Basin.

Rio Tinto announced yesterday that John Varley -- who joined its boards on 1 September -- has replaced Andrew Gould as chairman of the remuneration committee. Gould will retire from Rio Tinto’s boards following the 2012 AGMs.