Iberian Minerals Corp. (CVE:IZN) (PINK:IMINF) stock price has become locked after the company revealed to have entered into an acquisition contract with a major stockholder.
IZN stock value increased 31.3% on Thursday, carrying a heavy trading volume of 56.8 million. That was the heaviest trading volume ever recorded for IZN stock, far above the average of 1.75 million.
The heavy trading was a reaction to the company’s new pre-acquisition agreement with Trafigura Beheer B.V.
Following the contract, Trafigura will be making an offer to acquire the outstanding common stock of Iberian at CAD$1.10 per share. The amount is expected to be offered in cash. The offer will be classified as an insider bid since Trafigura already owns 48.3% of Iberian and will undergo an independent valuation before it can actually proceed.
In the light of this event, the other major shareholders and officers have entered into a lock-up agreement under which they agreed to tender all their IZN shares and in-the-money securities in favor of the proposed offer. The agreement accounts for 17% of Iberian shares.
The actual takeover bid should be filed no later than December 30, 2011.
Naturally, the stock price on the open market will be sticking very close to the proposed value, allowing traders to scalp trade only the minor fluctuations.
