Xstrata will acquire Sphere Minerals, which holds magnetite iron ore deposits in Mauritania, for $381m.

The company’s offer represents a 61% premium over the closing price of A$1.55 a share on the 23 August and a 73% premium over the volume weighted average price of Sphere shares over the last 30 trading days.

The acquisition will help Xstrata take control of growth projects including the Guelb el Aouj project, the Askaf project and the Lebtheinia project.

Iron ore is one of the biggest export earners for Mauritania, with state-owned miner Societe Nationale Industrielle et Miniere producing 10.2 million tons in 2009.