Champion Iron (TSE:CIA) executives outlined plans to launch a cash tender offer for Norway-based Rana Gruber during a conference call held Sunday, December 25, 2025, positioning the deal as a step toward expanding the company’s high-grade iron ore platform and deepening access to European steel markets.
Transaction terms and timeline
Chief Executive Officer David Cataford said Champion proposes to acquire 100% of Rana Gruber shares for 79 NOK per share, implying an equity value of roughly 2.9 billion NOK (about $290 million, as presented on the call). The offer is supported by Rana Gruber’s management, board, and “major shareholders,” and Champion said it has already received more than 51% support from key shareholders who were wall-crossed.
Financing plan: cash, private placement, and term loan
Champion detailed a three-part funding plan combining existing liquidity, new equity, and debt. Management said that as of September 30, 2025, Champion held roughly CAD 325 million in cash or cash equivalents, and expects to fund about $39 million from cash on hand.
Additional financing is expected to include:
- $100 million private placement with Caisse de dépôt et placement du Québec (“La Caisse”)
- $150 million fully underwritten term loan from Scotiabank, supported by a commitment letter
Cataford said La Caisse—described as Quebec’s largest pension fund—has supported Champion since 2017 and, following the private placement, would become the company’s largest shareholder at just under 8.5% of total shares outstanding.
Rana Gruber profile and European market positioning
Rana Gruber CEO Gunnar Moe described the company as a long-standing supplier to European steelmakers, noting it has been part of Norwegian industry for more than 60 years and has operated through multiple cycles. He added that since its 2021 listing, Rana Gruber has delivered strong financial and operational results and reached a milestone this year by producing concentrate with 65% iron content.
Champion said Rana Gruber is located in Mo i Rana near the Arctic Circle and employs about 370 people from the local community. Cataford said the company produces roughly 1.8 million tons annually from open-pit and underground operations and sells two blends: a hematite iron ore and a magnetite product.
On logistics, Champion characterized Rana Gruber’s setup as streamlined, with mines about 35 kilometers from the port and processing facilities located near port infrastructure. Management also emphasized proximity to customers, citing three to four days sailing time to major clients, which they said supports Rana Gruber’s position as a supplier of choice in Europe.
High-grade focus and decarbonization theme
Executive Chairman Michael O’Keeffe framed the proposed acquisition as consistent with Champion’s strategy to increase exposure to high-grade iron ore, which management linked to steel decarbonization trends and constrained supply. O’Keeffe also reiterated Champion’s operational roadmap at Bloom Lake, including plans to commission a high-grade plant in the first quarter of calendar 2026 to produce about 7.5 million tons of 69% Fe material.
Cataford said Rana Gruber’s current 65% Fe product could potentially move toward even higher grades in the future, and he compared that trajectory to Bloom Lake’s current production of about 66.2% Fe material and Champion’s plan to shift roughly half of its tonnage toward 69% Fe following the plant commissioning.
Management also pointed to policy and market dynamics in Europe. Cataford referenced the upcoming implementation and ramp-up of CBAM and said both Bloom Lake and Rana Gruber have “significantly lower” CO2 emissions per ton of iron ore produced, which he suggested could be advantageous as CBAM takes effect. He also cited recent measures aimed at protecting Europe’s steel industry, including rising tariffs for imported steel.
Financial discussion and integration approach
Champion said Rana Gruber’s cash costs have historically ranged between $45 to $55 per ton, which management said is lower than Bloom Lake’s current cash costs. Cataford added that Rana Gruber’s profitability has ranged from about $50 million to $110 million per year historically, prior to its recent upgrade to 65% Fe.
Chief Financial Officer Michael Marcotte said Rana Gruber would contribute nearly 20% of EBITDA on a trailing basis to the combined company, while the private placement would dilute Champion shareholders by about 5%. He also said the leverage profile would not change substantially and that Champion’s revolver would remain fully undrawn after the transaction. Marcotte added that the corporate strategy remains focused on high-grade iron ore and does not alter Champion’s view toward its capital return strategy.
During the Q&A, executives said they did not have a specific dollar figure for synergies, indicating the opportunity is expected to be more revenue-driven than cost-driven. Cataford highlighted potential marketing benefits from a stronger European footprint and reiterated Champion’s intent to reduce exposure to China by moving tonnage toward Europe, North Africa, and the Middle East. He also said the combined platform could support Rana Gruber’s product transition and potentially progress toward direct-reduction-grade material over time, with more detail expected after closing.
About Champion Iron (TSE:CIA)
Champion Iron Ltd is engaged in the exploration and development of iron ore properties in Quebec, Canada. The company’s operating segment include Mine Site, Exploration and Evaluation, and Corporate. It generates maximum revenue from Mine Site segment. The company projects include Fire Lake North, Powderhorn/Gullbridge, Moire, Quinto Claims, Harvey Tuttle, O’keefe-Purdy, and others.
