Bid spec continues to swirl around Cape

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Date: Friday 18 Jul 2008

LONDON (ShareCast) - Cape Lambert Iron Ore confirmed it met with people from Merrill Lynch and Evraz Group in Singapore yesterday, but said no information from that meeting needs to be advised at this time.

The Australian firm stirred up rumours of a bid yesterday when a director told Reuters of the upcoming meeting with an unidentified buyer of a large stake in the company.

Steelmaker Evraz, part owned by Russian billionaire and Chelsea football club’s Roman Abramovich has already bought a controlling interest in steel group Delong Holdings for $1.5bn.

Delong holds an option to buy 12% of Cape, fuelling speculation Evraz would launch a bid.

It emerged yesterday that a Merrill Lynch nominee company had exercised 56 million options for a 14% stake in Cape, thought to be on behalf of Evraz.

A bid from Evraz could derail the $400m sale of Cape’s project in the Pilbara region of Western Australia to China Metallurgical Group Corporation.

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