FTSE 100 giant Anglo American has thrown a potential lifeline to a huge fertiliser mine project in Yorkshire with a possible £386m offer to buy the company behind it.
Anglo American said it was in “advanced discussions” with Sirius Minerals over a takeover – which could save hundreds of jobs.
Sirius said that subject to certain conditions it expected to be able to recommend the 5.5p a share offer to investors – many of them local people who have ploughed in their own savings – though it would leave many out of pocket.
The share price was as high as 22p a year ago and peaked at 44p in 2016, though had fallen to 4.1p by the close of trading on Tuesday.
Sirius has been reviewing the North Yorkshire polyhalite mine after scrapping in September a plan to raise about £400m in a bond sale, delaying the project.
The review included a search for a new partner and investor to help fund the development. The UK government had declined to back it.
The plan involves tunnelling under the North York Moors National Park to exploit what Sirius has said is the world’s largest deposit of polyhalite.
The mineral would be transported through a 23-mile long tunnel to Teeside, from where it would be shipped to customers.
Last year, Sirius said 1,200 jobs related to the development of the mine would be lost if the company could not raise the funds needed to proceed.
The project would be the first deep mine to be sunk in Britain for 40 years.
But it has struggled to attract financing and analysts have questioned whether there is a market for the kind of fertiliser it would produce.
It has also attracted opposition from campaigners concerned about its impact on the North York Moors landscape.