Macarthur Coal Ltd. (MCC.AU) Friday rejected a A$3.7 billion bid
from New Hope Corp. (NHC.AU) and said that Xstrata PLC (XTA.LN) has
held talks with one of Macarthur's major shareholders, in a sign
that a bidding war for the Australian coal miner could further
intensify.
Brisbane-based Macarthur also said it will delay to April 19 a
shareholder meeting, originally planned for Monday to vote on
aspects of a planned takeover of Gloucester Coal Ltd. (GCL.AU) and
associated transactions with Noble Group Ltd. (N21.SG).
The level of interest in Macarthur -- the world's largest
exporter of pulverized coal -- is a sign of just how sought after
Australian coal resources have become as the outlook for coal
prices continues to strengthen, driven by strong Asian demand.
Earlier this week, Macarthur rejected a revised A$3.56 billion
bid from Peabody Energy Corp. (BTU).
At this stage, it continues to recommend its preferred deal with
Gloucester and Noble but investors pushed Macarthur Coal shares up
8.3% Friday to A$15.55 amid hopes that another bid could
emerge.
Macarthur said late Friday an investment bank representing
Xstrata had held talks with one of its biggest shareholders, but
didn't name the shareholder. Macarthur's biggest shareholders are
Posco (005490.SE), ArcelorMittal (MT) and China's Citic Resources
Holdings Ltd. 1205.HK). Representatives of Posco, ArcelorMittal and
Citic declined to comment. A spokesman for Xstrata in Australia did
not return calls.
"Macarthur understands that this discussion was 'preliminary and
highly conceptual'," the Australian coal miner said in a statement.
"Macarthur has no further information about the context or content
of that discussion, nor whether Xstrata has any substantive
interest in Macarthur or any of its assets," it said.
Earlier Friday, the Australian Financial Review reported that
Xstrata, which looked at a bid for Macarthur in 2008, had held
talks with Posco and ArcelorMittal.
The takeover tussle is the latest in a frenzy of corporate
activity in Australia's coal sector, which has seen the numbers of
coal miners listed on the Australian exchange dwindle and coal
assets become increasingly scarce, with most quality deposits
tightly held by mining majors like BHP Billiton Ltd., Rio Tinto
Ltd., Xstrata and Anglo American Plc.
New Hope, which has a market capitalization of A$4.4 billion, on
Friday offered 2.7 of its shares for every one Macarthur share by
way of a scheme of arrangement, which it said valued its target's
shares at A$14.58 each at the time of the bid. Brisbane-based New
Hope said it believed its bid was superior to both Peabody's A$3.56
billion cash offer, pitched at A$14 a share, and to Macarthur's
favoured plan of proceeding with a takeover for Gloucester Coal and
associated transactions with Noble Group.
But Macarthur said New Hope's proposal, like Peabody's before
it, undervalued the group.
"The board of Macarthur met this morning and unanimously
determined not to recommend the New Hope proposal to shareholders,
as the board has formed the view that the scrip (stock) ratio of
2.7 New Hope shares for every Macarthur share does not represent an
adequate premium for control of the company," Macarthur said in an
earlier statement.
Citi analysts said that a deal that values Macarthur at
A$16-A$20 a share could be more in the group's "ballpark" and
agreed that the London-listed Xstrata could be a logical buyer.
"Xstrata are a possibility and have the balance sheet and desire
to step up their Australian coal operations," analysts at Citi
said. "They could also offer Posco and Arcelor some significant off
take from Xstrata's Australian coking coal mines, which could
sweeten the deal."
The Citi analysts also said that Macarthur's biggest
shareholder, Citic, should not be ruled out as a potential bidder.
Citic already owns 22.4% of the company and "given they are a
Chinese state-owned enterprise", may not have trouble funding a
deal.
"They may look to join the party and secure full control and
security of supply from Macarthur," Citi said.
Macarthur exports pulverized, or PCI coal, a premium product
used in steel making, which has recently risen in price by 89%
thanks to strong Asian demand.
Both New Hope's and Peabody's offers were conditional on
Macarthur not proceeding with its planned takeover of thermal and
coking coal producer Gloucester Coal and associated transactions
with Noble. A Peabody spokesman did not return calls seeking
comment.
The battle for Macarthur has spurred hopes for further
consolidation in Australia's coal sector. Citi analysts named
Whitehaven Coal Ltd. (WHC.AU) as the "next likely target". China's
Shenhua "are a likely bidder given their large resource base in the
Gunnedah but lack of rail and port exposure," the Citi analysts
said.
Citi also said that New Hope could shift its focus to Centennial
Coal Co. (CEY.AU) as it looks to beef up its exposure to the
sector.
New Hope Chairman Robert Millner said that if New Hope fails in
its offer for Macarthur, the group is still looking to make
acquisitions.
"We have done a lot of work on all coal companies. We are
sitting on a lot of cash and we are looking to do something," he
told Dow Jones Newswires in an interview Friday.
Asked if New Hope could turn its sights on Centennial, Millner
said: "It is another good Australian producing company and, as I
said, we have got our eyes open."
Whitehaven Coal shares closed up 7.2% at A$5.79, giving it a
market capitalization of A$2.86 billion, and Centennial Coal up 2%
at A$4.52, giving it a market capitalization of A$1.78 billion.
-By Alex Wilson, Dow Jones Newswires: 613-9292-2094;
alex.wilson@dowjones.com
(Lyndal McFarland in Melbourne contributed to this article)
Centennial Coal (ASX:CEY)
Gráfica de Acción Histórica
De May 2024 a Jun 2024
Centennial Coal (ASX:CEY)
Gráfica de Acción Histórica
De Jun 2023 a Jun 2024
