Thomson Reuters






* Cliffs offers C$0.90/shr, or C$211 million

* Freewest holds chromite deposit in Ontario

* Offer follows Noront hostile bid
(Adds background, stock movement)

By Cameron French

TORONTO, Dec 3 (Reuters) - Cliffs Natural Resources
raised its friendly takeover offer for Freewest Resources
Canada on Thursday, hoping of trumping a rival bid from
Noront Resources and gain control of Freewest's
Canadian chromite deposit.

Cliffs' revised all-stock offer values each Freewest share
at 90 Canadian cents, and the company at about C$211 million
($200 million) it said. This represents a 6 percent premium on
Freewest's closing price on Wednesday.

The fraction of Cliffs' shares offered would be determined
before the transaction closes.

Freewest shares rose 3 Canadian cents to 88 Canadian cents.
The stock has risen about 170 percent since early October when
Noront kicked off what has since become a bidding war.

Freewest said its board has agreed to support the deal.

On Monday, Noront raised its offer for Freewest to 86
Canadian cents a share in stock and warrants, calling it at the
time its final offer.

Joanne Jobin, Noront's vice-president of corporate
communications, said the company did not plan to raise its bid,
but noted she had not yet consulted with the board of directors
to finalize that position.

"We could keep raising our bid and Cliffs could outbid us
until the cows come home, to be frank," she told Reuters.

"We cannot dilute our position any more for our
shareholders, so that's where we're at."

NORTHERN ONTARIO ASSETS

Noront, which like Freewest is a junior Canadian miner,
holds exploration assets near Freewest's chromite find in
northern Ontario.

Chromite is an essential raw material for the production of
chromium, which is used in the production of stainless steel.

U.S.-based Cliffs produces iron ore pellets and coal for
steel manufacturers.

Noront initially bid 39.75 Canadian cents a share for
Freewest, based on prices at the time of the Oct. 5 offer.

Cliffs, which already owns 12.4 percent of Freewest,
followed that up with an offer of 70 Canadian cents a share for
Freewest, with 15 Canadian cents of that in the form of a
planned spinoff of Freewest's non-chromite assets.

The latest Cliffs offer will not spin of those assets.

Cliffs' shares slid 87 cents to $45.08 on the New York
Stock Exchange, while Noront rose 9 Canadian cents to C$2.36 on
the TSX Venture Exchange.

Noront struck high-grade nickel and copper in the "Ring of
Fire" area west of James Bay in northern Ontario two years ago,
sending its shares up sharply and triggering a staking rush.

Since then, Noront has hit two chromite deposits, while
Freewest has been defining what it calls a "potentially
world-class caliber chromite district" at its nearby Black Thor
deposit.

Earlier on Thursday, Noront announced a preliminary
development plan for its deposits, projecting that feasibility
studies could be completed by 2011, and mining of the nickel
and copper deposit could begin as early as 2016.

Mining of the chromite deposit would be expected to take
longer due to higher infrastructure requirements, it said.

($1=$1.05 Canadian)
(Reporting by Cameron French; editing by Rob Wilson)
((cameron.french@thomsonreuters.com; 416-941-8199: Reuters
Messaging: cameron.french.reuters.com@reuters.net))