Shares in embattled Sirius Minerals surged as markets opened after shareholders approved a controversial £405m takeover by mining giant Anglo American.
Within minutes of the FTSE opening, Sirius’ stock had risen over 17 per cent as investors rushed to buy stock in the firm, which was rescued from potentially having to close its potash mine in Yorkshire by a vote of 80.3 to 19.7.
The vote, the result of which was announced shortly before nine yesterday night, followed an at times turbulent meeting between the company’s executives and its shareholders, many of whom had invested their life savings into the company.
Most of Sirius’ investors bought in at around 25p, but in January Anglo American made a 5.5p per share offer for the firm, which has been in desperate need of new funding after alternative arrangements fell through in September.
“The positive outcome from today’s meeting secures a return for shareholders, and provides greater certainty in terms of safeguarding the project, protecting the jobs of our employees, and allowing the community, region and the UK to continue to benefit from the project,” Sirius chairman Russell Scrimshaw said after the meeting.
Sirius boss Chris Fraser had previously urged shareholders to support the Anglo deal, saying there was no obvious alternative. This view was shared by local conservative MP Robert Goodwill, who is himself an investor.
Earlier this week high profile investors came out in favour of either side, with husband and wife Crispin Odey and Nichola Pease, Jupiter Fund Management’s boss, backing different sides.
Whilst Jupiter, which owns a 7.8 per cent stake in Sirius, pledged to back the deal, Odey’s fund opposed it, arguing that the 5.5p offer was not the “best and final” offer that could have been made.
The polyhalite deposit which is the focus of all the attention, is believed to be the largest high-grade site in the world.
The so-called Woodsmith project, which is the largest mine to be developed in the UK for a generation, is expected to provide 1,200 jobs.
Shares in Anglo American also rose 1.4 per cent as markets opened.