Alcan has entered early-stage discussions with global mining giant BHP Billiton as it looks to fend off an unwanted takeover attempt by US rival Alcoa, Canada's Global and Mail newspaper reported, citing people familiar with the matter.
The report was sending shares of Alcan higher before the opening bell on Wednesday. However, even before Alcan rejected Alcoa's offer investors were already pricing in a higher offer into the stock's price, with Alcan shares closing at $81.03, or 8.6% higher than Alcoa's $28.4 billion hostile offer.
On Tuesday, Montreal-basedAlcan rejected Alcoa's bid, arguing that it didn't fairly value the company and is "highly conditional and uncertain."
In an interview with AFX, Alcan Chief Executive Dick Evans said all options were being considered, and he refused to rule out any scenario including one in which Alcan would turn the tables by launching its own bid for Alcoa .
"The operative word here is all," he said, adding that Alcan is in "ongoing discussions with other third parties."
Evans declined to identify them, but sources said BHP , the world's largest miner, has begun talks with Alcan. BHP approached the company about a possible union late last year, but was rebuffed, sources said. Rio Tinto as been cited by several industry observers as another logical suitor for Alcan.
Officials at Alcoa declined to comment, saying they are still studying Alcan's response.
On Tuesday, Alcan told its shareholders not to tender shares to the Alcoa offer.
Alcan's shares closed at $81.03 on the New York Stock Exchange on Tuesday, well above Alcoa's offer of $58.60 a share plus 0.4108 of its shares, which values Alcan at $75 a share.