THE CANADIAN PRESS

Stumble Upon

del.icio.us

Digg

Facebook

Print

Email

Speak Up

TORONTO - Jaguar Financial Corp. (TSX:JFC) announced Monday it has requisitioned a special meeting of shareholders of HudBay Minerals Inc. (TSX:HBM) to replace HudBay's directors with nominees proposed by Jaguar and other shareholders.

The move came after zinc miner HudBay announced Friday it is buying Lundin Mining Corp. (TSX:LUN) in a friendly deal that creates one of Canada's biggest publicly traded base-metals companies.

Jaguar was quick to object to the merger, saying it planned its own conditional offer to take over HudBay for $5.40 per share or $826 million in a complex swap of securities for shares.

The Jaguar offer is conditional on the cancellation of the HudBay-Lundin deal.

Jaguar questioned the legality of what it described as a "defensive anti-takeover device by HudBay."

"Swallowing Lundin would provide HudBay with an effective poison pill; however, we question whether it is legal or appropriate, particularly as HudBay's shareholders are not being afforded the opportunity of voting on the business combination," stated Vic Alboini, chairman and CEO of Jaguar.

Jaguar said the shareholders requisitioning the special meeting together hold more than five per cent of HudBay's shares.

Also Monday, U.S. investor Corriente Master Fund LP accused the HudBay board of "an act of gross mismanagement" by approving the transaction.

In a letter sent to the HudBay board, Corriente said the deal had "no possible beneficial effect for HudBay or its shareholders."

Corriente called the proposed transaction an "ill-advised attempt by HudBay's management and its financial advisers to further their 'empire building' goals with the company's cash, to the detriment of HudBay's shareholders."

HudBay shares closed Monday at $3.31, up 15 cents from the previous close but down from $5.23 prior to the merger announcement. Lundin shares closed Monday at 95 cents, down 10 per cent from Friday's close before Jaguar made its objections public and down from $1.01 prior to the merger announcement.