* Current Anglo offer 'makes a mockery' of valuation, Odey
says
* Hedge fund will vote in favour at 7 pence per share or
above
* Sirius Minerals rises around 1%
* Anglo has no comment, Sirius has no immediate comment
(Adds Sirius comment)
By Abhinav Ramnarayan and Barbara Lewis
LONDON, Feb 19 (Reuters) - Hedge fund Odey Asset Management
said it would oppose Anglo American's 405 million pounds
($526 million) bid to acquire a huge fertiliser project from
Sirius Minerals, saying the terms do not represent fair
value.
The asset under a national park in North Yorkshire, northern
England, is Britain's biggest mining project and has political
resonance as the government works to create jobs in an
economically disadvantaged part of the country.
Its future was in jeopardy until Anglo made its 5.5 pence
per share bid for a project whose viability some analysts have
questioned. But Odey said the offer was too low and seems "to
make a mockery of both internal and external audits at Sirius."
In an open letter, Odey, which held a 1.29% economic
interest in Sirius as of Feb. 18, said it would only vote in
favour of a bid at 7 pence per share or more.
"The lack of 'final' offer, in Odey's opinion, suggests that
Anglo American would be willing to bid substantially more for
Sirius, with the investment case remaining highly attractive for
Anglo American, even at a materially higher bid level," the
hedge fund said in the letter.
A spokesman for Anglo American declined comment. Sirius said
in an emailed statement that its board was unanimous in
recommending shareholders vote for Anglo's bid as it stands.
"We recognise that the current offer does not represent the
value that the board and shareholders had previously hoped for.
However, given the situation the company finds itself in, we
face a stark choice," the statement said.
"In the event of this transaction being unsuccessful there
is a high probability that the business will need to be placed
into administration or liquidation."
Anglo American agreed last month to buy Sirius Minerals for
405 million pounds in cash, marking the global miner's return to
fertilizers.
Sirius had struggled to find financing in private markets
and last year scrapped a plan to raise $500 million in a bond
sale.
Its shares have fallen by around 75% since the start of 2019
despite a bounce when news of the Anglo American bid broke. By
1200 GMT on Wednesday they were up 3% at 5.19 pence, roughly in
line with the UK mining sector
The share price fall has hit many local people who invested
in the plan to develop what Sirius has said is the world's
largest deposit of polyhalite, a multi-nutrient fertiliser.
(Reporting by Abhinav Ramnarayan and Barbara Lewis Editing by
Sinead Cruise and David Holmes)
Anglo American (AAL)
