PERTH (miningweekly.com) – Iron-ore major Fortescue Metals on Monday said that it would retain a “substantial shareholding” in takeover target Atlas Iron, despite reducing its interest from 19.9% to 11.37%.

“Fortescue has considered its options with regard to the 19.9% shareholding in Atlas Iron and has decided to retain a substantial shareholding for strategic reasons, reflecting our confidence in the long-term fundamentals of the iron-ore sector in the Pilbara,” said Fortescue CEO Elizabeth Gaines.

“Fortescue looks forward to participating in the future Atlas Iron and is confident that the directors of Atlas Iron will continue to act in the best interest of all shareholders,” she added.

Fortescue’s decision comes after Gina Rinehart’s Hancock Prospecting gained a 56.07% stake in Atlas under a current off-market takeover bid.

An independent expert recently found that Hancock’s 4.2c-a-share offer for Atlas was both fair and reasonable, prompting the Atlas board to urge shareholder acceptance of the offer.

The offer period has now been extended until August 17.

Fortescue in June this year applied to the Takeovers Panel in a bid to stop Hancock Prospecting from gaining a greater stake in Atlas, saying that its bidder statement contained misleading statements and material omissions regarding the company’s intentions in relation to the Atlas business, assets and employees.

Fortescue claimed that the bidders statement also contained material omissions regarding the implications of Hancock’s takeover bid for Atlas’ term loan B facility, and its intention toward repaying this facility.

The Takeovers Panel declined to conduct proceedings.

Meanwhile, Fortescue on Monday said that it would actively participate in the proposed industry consultation with the Western Australian government regarding berth access at Port Hedland.

“We will continue to focus on our $1.25-billion Eliwana mine and rail project, together with the pending decision on the Iron Bridge high-grade magnetite project with our joint venture partners later this calendar year,” said Gaines.