Australia's Arrium tumbles after $1.2 bln takeover approach pulled

SYDNEY Wed Oct 31, 2012 7:25pm EDT

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SYDNEY Nov 1 (Reuters) - Shares in Australia's Arrium fell as much as 15 percent on Thursday after a consortium including POSCO and Noble Group dropped their A$1.2 billion takeover approach for the steel and iron ore company after being rejected by the board.

Arrium shares fell as low as A$0.67 on Thursday morning compared with the A$0.88 per share price the consortium, Steelmakers Australia, had proposed and which the Arrium board rejected as opportunistic and under-valuing the firm.

Shares in Arrium had traded as low as A$0.50 shortly before Steelmakers Australia's initial $A0.75 per share approach a month ago.

(Reporting by Lincoln Feast; Editing by John Mair)