International Mining and Infrastructure Corporation confirms bid for Afferro Mining



International Mining and Infrastructure Corporation has confirmed it has submitted a takeover approach for Afferro Mining (Other OTC: AFRIF - news) .

Aim-listed International Mining and Infrastructure Corporation (IMIC) was set up to acquire stakes in projects, businesses or companies in the resource sector with a focus on mining and infrastructure.

IMIC's confirmation of its takeover approach comes after Afferro released details of its indicative offer on New Year's Eve.

Afferro - an Aim-listed iron ore mining company focused on West Africa said that IMIC's approach valued each Afferro share at between 115p and 140p.

IMIC's offer was conditional on completion of satisfactory due diligence and "certain other conditions", according to Afferro.

Any offer for Afferro from IMIC is likely to made using a mixture of cash and new IMIC shares as the investment vehicle is significantly smaller than Afferro. Indeed, IMIC has a market capitalisation of £17m whereas Afferro is valued at £108m.

IMIC faces stiff competition for Afferro. This is because the iron ore miner said that on January 31 2012 that it is currently "under exclusivity obligations" with one other party which precludes it from engaging in discussions with IMIC until January 13.

It is not clear which party is in exclusive talks with Afferro, although traders believe it is a "major" mining company.

Afferro also said it is has been talking other bidders, one of which is thought to be India-based Jindal Steel & Power (BSE: JINDALSTEEL.BO - news) .

IMIC, though, does have an advantage over other bidders. Previous reports claimed the investment vehicle, which is being advised by financiers from Bank of America Merrill Lynch, already owns 3.9pc of Afferro after buying shares on the open market at 48p last summer.

Afferro shares dipped 0.75 to 100.5p, while IMIC shares marked time at 28.25p.