Australian firm Hancock Prospecting’s subsidiary Redstone has submitted a A$390m ($289.87m) takeover bid for mining company Atlas Iron.

Under the terms of the offer, Redstone has proposed to purchase all of the ordinary shares in Atlas Iron for $0.042 per share.

Hancock Prospecting is owned by billionaire Gina Rinehart and acquired a 19.96% interest in Atlas Iron earlier this month after Fortescue Metals Group bought a similar interest in the company.

“Some of the Atlas deposits contain elements that have complementary characteristics providing optionality and opportunity.”

The proposal made by Redstone follows an agreement reached by Mineral Resources (MinRes) to acquire the entire issued capital of Atlas through an arrangement scheme, in a deal valued at A$280m ($208.11m).

As per the bid, MinRes offered one share to Atlas shareholders for every 571 Atlas shares held by them in the company.

MinRes will now have three business days to match the offer made by Redstone.

Hancock expects the transaction to align with other iron ore interests within the company.

Hancock Prospecting executive director Tad Watroba said: “There is potential to unlock value through the future development of Atlas resources as part of our wider system of operations.

“If we obtain control of Atlas, we intend to conduct a strategic review to better understand the most appropriate time and means to develop and integrate Atlas into the existing operations of the Hancock group.

“Some of the Atlas deposits contain elements that have complementary characteristics providing optionality and opportunity to improve the non‐iron elements of ore quality further.”

Meanwhile, Atlas resources also offer the potential to extend the life of existing Hancock iron ore interests.

The Hancock Group owns a 50% interest in the 45mtpa Hope Downs iron ore mine in the Pilbara in a joint venture with Rio Tinto, and a 70% interest in the 55mtpa Roy Hill integrated project.

The company also has several iron ore exploration prospects in the Pilbara region, including its Mulga Downs project.

The Atlas Iron board will assess the acquisition bid made by Redstone and the company has advised the shareholders not to take any action at this stage until a recommendation is made.

Atlas mines and exports direct shipping ore (DSO) from its operations in the Northern Pilbara region.

Its assets include Mt Webber mine, Abydo, and expansion projects such as Corunna Downs and McPhee Creek.