Peabody Energy on path to full Macarthur Coal acquisition

Thursday, 17 November 2011

St. Louis, Missouri-based Peabody Energy, the world's largest private-sector coal company, announced Wednesday that its subsidiary PEAMCoal Pty Ltd has acquired over 90 percent of all of the shares of Australian metallurgical coal producer Macarthur Coal. By acquiring 90 percent of the shares, PEAMcoal is compulsorily able to purchase the remaining shares.

Other shareholders such as South Korea's POSCO, which owns a 7.25 percent stake, will be forced to sell its shares to Peabody. The purchase price will also increase to A$16.25 (US$16.39) per share, up from A$16.00 (US$16.14) per share--Peabody had previously agreed to increase its offer price per share if it was able to acquire a 90 percent stake.

Tags: Met Coke , Korea S. , USA , Australia , Korea , Macarthur Coal , POSCO , raw mat , East Asia and Pacific , Oceania , Far East , North America , mining , M&A

Sourced:SteelOrbis

Peabody Energy nearing full control of Macarthur Coal

Tuesday, 15 Nov 2011

Peabody Energy's USD 4.9 billion bid for Australian coking coal miner Macarthur Coal is inches away from completion after the world's largest private sector coal miner said it had acquired 87.8% of the shares in Macarthur.

The move gets Peabody within reach of the 90% level at which it can forcibly buy out remaining minority shareholders in Macarthur and the offer price rises automatically to USD 16.25 a share from USD 16 per share.

The bid for Macarthur has not been without complication late last month, European steelmaker ArcelorMittal pulled out of a joint deal with Peabody to take over Macarthur.

ArcelorMittal said at the time that the deal required it to invest too much capital in a business it wouldn't fully control.

The bid continued, however, with ArcelorMittal to sell its interest to Peabody.

Days before ArcelorMittal's announcement, the pair's bid vehicle, PeamCoal, took a majority stake in Macarthur, after having launched the USD 4.9 billion bid.

ArcelorMittal said in a statement at the time that "Given the unanticipated level of acceptances into the offer, ArcelorMittal believes that it is more appropriate to focus its capital elsewhere in its business.”

(Sourced from AAP)

Macarthur offer further extended

Friday, 11 November 2011

PEAMCoal Pty Ltd (PEAMCoal), owned by the US coal giant Peabody Energy Corp., has announced that it has extended the offer period under its takeover bid for all the ordinary shares of Australia-based low-volatile metallurgical coal producer Macarthur Coal Limited by two weeks. The offer will now close on November 25, 2011, unless further extended.

As SteelOrbis previously reported, PEAMCoal will increase the offer price for all shareholders from A$16.00 to A$16.25 per share if it acquires relevant interests in at least 90 percent of Macarthur shares by November 25, 2011. Reaching the 90 percent relevant interest threshold will allow PEAMCoal to compulsorily acquire all outstanding Macarthur shares.

Tags: Met Coke , Australia , USA , Macarthur Coal , raw mat , North America , Oceania , mining , M&A

(sourced steelorbis)

ArcelorMittal to leave Peabody with $5 bn Macarthur bid

Tue, 25 Oct, 2011 |Reuters

BRUSSELS: ArcelorMittal , the world's largest steelmaker, has unexpectedly pulled out of its joint $5 billion bid with Peabody Energy for Australian miner Macarthur Coal , just a day after the buyers said they had secured a majority of shares.

In a joint statement sent to Australian regulators by Peabody's legal advisors, ArcelorMittal and Peabody said the steel giant had "elected to sell its interest" in their bid vehicle, PEAMCoal, instead of proceeding with a joint venture.

ArcelorMittal did not say why it was selling out and was not available for comment.

Peabody and ArcelorMittal bid A$16 per share for the coal miner offer and said on Monday they already had a relevant interest in about 59.85 percent of the shares`.

China's Citic, which owns a quarter of Macarthur, said on Friday it had accepted the offer despite speculation it had been holding out for a higher price or could launch a rival offer of its own.

The last remaining major shareholder in Macarthur yet to accept the offer is South Korean steel maker POSCO , which owns a 7.25 percent stake.

If POSCO accepts the offer, that could help push acceptances above 90 percent, which would lead to Peabody raising the offer to A$16.25 a share.

Peabody said in Tuesday's statement that it would now own 100 percent in PEAMCoal and become owner of all the Macarthur shares that are tendered in the bid.

Shares in ArcelorMittal were 1.9 percent higher at 14.71 euros by 1123 GMT, when the STOXX Europe 600 Basic Resources sector index was up 0.8 percent.

Under the terms of its agreement with Peabody, ArcelorMittal must continue funding PEAMCoal for a further 90 days, the statement said.

ArcelorMittal and Peabody put in a bid for Macarthur in July, which the pair eventually took hostile in August after the Macarthur board said the bid undervalued the company.

A previous bid by Peabody to acquire Macarthur last year collapsed after Peabody cut its offer, blaming a new government mining tax.

sourced ET

Macarthur Coal directors to appoint Peabody-Arcelor nominees

Tue, Oct25, 2011

THE directors of Australian coal miner Macarthur Coal will stand down tomorrow and appoint nominees of the joint venture between Peabody Energy and ArcelorMittal, which took control of the miner yesterday, the company said.

Macarthur chairman Keith DeLacy said the takeover, which values Macarthur at $4.9 billion, was a "testament to Macarthur's extraordinary growth over the last decade".

The takeover joint venture, PEAMCoal, announced late yesterday that it had acquired 59.86 per cent of Macarthur shares, with a further 2.51 per cent in an acceptance facility, giving the company 62.37 per cent of shares.

US giant Peabody Energy yesterday completed its 19-month battle for the Queensland company.

The takeover was finalised as reports emerged last night of a possible bid for another Queensland coal producer, New Hope, Sarah-Jane Tasker reported yesterday.

The Peabody-ArcelorMittal $16-a-share bid was launched on July 11.

The US giant, which already operates eight projects in Queensland and NSW, had made four unsuccessful offers early last year.

It offered $13 a share in March 2010, before raising the bid to $14 a week later and $16 on April 15.

On May 10, the company reduced its offer to $15 a share following the controversy over Kevin Rudd's failed resource super-profits tax.

But Peabody did not give up and in July this year it gained the support of Macarthur's major shareholder ArcelorMittal, which had a 16 per cent stake, to resurrect its move on the miner, the day after the Gillard government announced the carbon tax.

The two parties had originally offered $15.50 a share, but the target's board secured the $16 price to win its support.

PeamCoal, the 60-40 joint venture formed by Peabody and Arcelor to bid for Macarthur, then announced on Friday that it would increase the offer price to $16.25 a share if it acquired at least 90 per cent of the miner by November 11.

(sourced The Autralian)

Peabody and ArcelorMittal extend offer for Macarthur Coal to November 11

Thursday, 20 Oct 2011

Peabody Energy and ArcelorMittal have extended their AUD 4.9 billion takeover offer for Australia's Macarthur Coal until November 11th 2011.

The bid had been due to expire on Oct 28.

Macarthur has accepted a sweetened AUD 16 per share bid from Peabody and Arcelor after failing to find a rival bidder.

(Sourced from Reuters)

Deadline extended on Mac Coal offer

October 07, 2011 12:00AM
By Tony Grant-Taylor, Herald Sun

GLOBAL steel giant ArcelorMittal again has extended the deadline for Macarthur Coal shareholders to accept the $4.8 billion takeover offer tabled by the European group.

ArcelorMittal, the world's biggest steelmaker, and US coal miner Peabody are offering $16 a share for a stake of at least 50.01 per cent in Macarthur.

The companies last month said they had secured shares equivalent to 21 per cent of the Queensland-based group.

The bidding vehicle, PEAMCoal, yesterday extended to 8pm on October 28 the deadline for shareholders to accept the offer.

PEAMCoal originally had set a deadline of September 27, before pushing that to October 14. The takeover offer is backed by Macarthur's board.

The extension came as shares in another coal miner, New Hope, edged up only 1c yesterday, or 0.2 per cent, to $6.11 after rallying on Wednesday after its call for expressions of interest from potential bidders.

Start of sidebar. Skip to end of sidebar.

End of sidebar. Return to start of sidebar.

Analysts say New Hope may be hard pressed to drum up offers at $7.60 or more - the starting price nominated by stockbroker RBS Morgans as the level necessary to win over New Hope's majority shareholder, Washington H Soul Pattinson.

Most bidders for coal assets over the past year have seen their share prices slump - including US groups Alpha Natural Resources and Peabody.

Alpha in January agreed to buy fellow US group Massey Energy, only to see its shares slump more than 60 per cent as investors worried about a fall in demand due to European and US economic woes.

Broker Bell Potter director Angus Aitken says New Hope could be worth $5.8 billion - about $7 a share.

But Rick de los Reyes, a manager at T Rowe Price Group's Global Metals and Mining Fund, said: "This deal is more attractive than the other coal deals that we've seen this year".

"The fact Australia is close to China, China went from net exporter to a net importer of thermal coal and New Hope has (its own) port capacity, that's huge."

New Hope said this week it would invite selected groups to submit formal offers.

Macarthur Coal awards Codrilla contract

Friday, 30 Sep 2011

Bowen Basin miner Macarthur Coal has awarded USD 85 million contract to construct the coal handling and preparation plant at the Codrilla Coal Mine for the Coppabella Moorvale Joint Venture to mining services company Sedgman and Thiess, a subsidiary of Leighton Holdings.

The Thiess Sedgman Joint Venture will design, procure, construct and commission the plant on behalf of Macarthur with it due for completion by mid 2013 a year and a half after mining operations commence.

Sedgman relationship with Macarthur Coal spans 12 years starting with building the coal handling and preparation plant for Coppabella Mine and then for the Moorvale and Middlemount mines.

Mr Nick Jukes CEO & MD of Sedgman says the company is extremely pleased to be further strengthening this relationship with the miner.

The contract is not contingent on any outcomes of the USD 4.83 billion PEAMCoal takeover offer for Macarthur Coal.

(sourced from ABC.net.au)

Peabody extends offer for Australia's Macarthur to Oct. 14

Sep19, 2011

SYDNEY, Sept 19 (Reuters) - Peabody Energy and ArcelorMittal have extended their $5.2 billion takeover bid for Australia's Macarthur Coal until Oct. 14, the companies said on Monday.

Macarthur last month accepted a sweetened A$16 per share bid from Peabody and Arcelor after failing to find a rival bidder.

The bid had been due to expire on Sept. 27.

Macarthur Coal still hoping for rival to Peabody Energy ArcelorMittal bid - Report

Wednesday, 07 Sep 2011

The Australian reported that Macarthur Coal's board is still hoping for a higher takeover bid, despite reaffirming its recommendation of the sweetened offer of Peabody Energy and ArcelorMittal.

Mr Keith De Lacy chairman of Macarthur Coal said that "As previously advised, Macarthur had pursued discussions with third parties, which had expressed interest in putting forward a superior proposal for Macarthur's shares. The directors advise that as at today, no superior proposal has been received. Although it remains possible that a superior proposal might be made, there can be no assurances that any will emerge."

Macarthur also noted that Mr Zeng had made no recommendation or statement about the intentions of Citic Group on the takeover bid. The deal with PEAM Coal, a 60:40 JV between Peabody and ArcelorMittal, has a no shop, no talk condition, but the target's recommendation assumes the absence of a higher bid.

Macarthur also used the target statement to warn shareholders of ongoing uncertainty about the regulatory environment it operated in. It said the mining and carbon tax and land access issues could reduce profitability.

Mr De Lacy said that "By accepting the PEAM offer, Macarthur shareholders are able to crystallize cash value for their shares and remove any ongoing exposure to market, regulatory and other risks that Macarthur Coal may face in the future, assuming that the PEAM offer becomes unconditional."

Many believed a rival offer for Macarthur was likely, with 25% shareholder Citic Group the key to any alternative bid. But with no firm deal apparent, the target's board accepted Peabody and ArcelorMittal's increased price.

The USD 4.9 billion, USD 16 a share bid had been raised from the USD 15.50 offer launched on August 1st 2011.

(sourced from TheAustralian)

Anglo American could lose out on Macarthur Coal

Thursday, 01 Sep 2011

The Telegraph reported that Anglo American is poised to lose out in the AUD 4.9 billion takeover tussle for Macarthur Coal after the Australian company recommended a sweetened offer from a consortium of US based Peabody Energy and European steelmaker ArcelorMittal.

Anglo American had gained access to the Australian group's data room and had been weighing up whether to make a formal offer for Macarthur, which mines low cost coal.

However, Macarthur has recommend an increased AUD 16 a share offer from the Peabody ArcelorMittal combine after the pair lifted the offer price from AUD 15.50. Macarthur shareholders are also entitled to a recently declared dividend, making the total offer AUD 16.16 a share. Macarthur shares rose 0.06 cents to AUD 15.86.

ArcelorMittal already owns 16.1% of Macarthur's shares and the offer from the PEAMCoal bid vehicle is conditional on securing 50.01% acceptances from the coal mining company's shareholders. The acceptances threshold was put in place to get around China's Citic Resources, which has a 24.5% stake in Macarthur and could move to block a full scale takeover.

In 2010, the Chinese group made it clear it would not endorse a change of control when Peabody, which was then acting alone, made a failed an AUD 15 a share bid for Macarthur. Some analysts reckon the protracted takeover battle for Macarthur is over. This is because it has already agreed an AUD 48.3 million break fee, and also no shop and no talk provisions that restrict any future negotiations with rival bidders.

PEAMCoal also has the right to provide a matching offer in the event of any competing proposal that Macarthur's board considers superior.

Mr Jamie Spiteri, head dealer at Shaw Stockbroking in Sydney, told Bloomberg that "There's probably not a lot more that can be extracted for Macarthur shareholders unless there's a challenge from another party."

Mr Andrew Harrington, an analyst with Patersons Securities, said that "It's a fair value price. Any counter bid is becoming increasingly difficult."

In its statement to the Australian stock exchange, Macarthur said a number of parties have conducted due diligence.

The Macarthur deal comes amid a revival of takeovers of mining companies following a sell off of natural resource company share prices. They include last week's AUD 268 million bid by Glencore International for Minara Resources.

sourced Telegraph

Peabody ArcelorMittal and Macarthur board agree for takeover

Tuesday, 30 Aug 2011

Peabody Energy and ArcelorMittal announced that PEAMCoal has agreed to terms with the Macarthur board for a cash takeover of all outstanding shares of Macarthur Coal for AUD 16 per share, valuing the equity in Macarthur at approximately AUD 4.8 billion and all participating members of the Macarthur Board recommend that Macarthur shareholders accept the new PEAMCoal offer.

Mr Gregory H Boyce chairman & CEO of Peabody Energy said “This is a major step forward in our acquisition process. We are pleased to have Macarthur, Peabody and ArcelorMittal moving forward together to urge shareholders to accept this attractive premium. We now look forward to completing this transaction in a timely manner.”

Mr Aditya Mittal CFO and Member of the Group Management Board at ArcelorMittal said "Our offer is the only offer before Macarthur shareholders, and we urge them to accept without delay and receive a substantial premium for their investment."

PEAMCoal and Macarthur have entered into an implementation deed, which is available on PeabodyEnergy.com. The improved offer is subject to limited conditions as set out in section 11.7 of PEAMCoal's replacement bidder's statement dated 15 August 2011, including minimum 50.01% acceptances and final regulatory clearance or expiry of the relevant waiting period.

The price to be received by Macarthur shareholders of AUD16 per share represents a substantial premium of
1. 44% to AUD 11.08 per share, the closing price on July 11, the day Peabody and ArcelorMittal's initial approach was disclosed to the market
2. 48% to AUD 10.82 per share, the one-month volume-weighted average price (VWAP) to July 11
3. 41% to AUD 11.32 per share, the three month VWAP to July 11
4. 33% to AUD 12.02 per share, the twelve-month VWAP to July 11

Macarthur Coal is a leading producer of low volatile PCI metallurgical coal with production and development assets in the Bowen Basin, Australia, including the Coppabella and Moorvale Joint Venture, Middlemount and Codrilla. It holds total coal reserves of 270 million tonnes and total resources of approximately 2.3 billion tonnes.

US coal giant says taxes make Australian investment less attractive

Fri, August 26, 2011
By Matt Chambers, The Australian

Peabody Energy says the government is making it less attractive to invest in Australia because of proposed taxes.

The US coal giant, jointly bidding $4.7 billion for Macarthur Coal with the world's biggest steel company ArcelorMittal, also says there is a heightened sovereign risk.

Speaking in Sydney yesterday, senior vice-president of investor relations, Vic Svec, said despite Peabody's continued investment in Australia, there was no question that the nation's relative advantage in attracting foreign investment was shrinking under the current government.

"It's really only in the last year you've heard sovereign risk being associated with Australia, and we don't like that," he said.

Peabody is Australia's fifth-biggest coal producer, but it will jump to the third-biggest if it is successful in the joint $15.50-a-share cash bid for Macarthur.

"We want Australia to be more welcoming to capital, as opposed to less welcoming, to ensure we don't take a meat cleaver to the milk cow," Mr Svec said.

He said Australia was "absolutely" becoming less welcoming to capital through the proposed mining and carbon taxes.

Peabody, the world's biggest non-government coal company, sold 246 million tonnes of coal last year - all from the US, apart from 27 million tonnes in Australia.

Despite this, its Australian operations accounted for 60 per cent of the company's earnings because most of the US coal is contracted domestically for much lower prices than are fetched on export markets.

Mr Svec said he had not planned for any formal meetings with Macarthur during his visit, but the company continued to engage with its target and hoped that an agreement could be reached.

"Their mantra of taking no action seems to be going on for a pretty long time," he said.

When Macarthur released its full-year profit on Wednesday, the company said it remained in conversations with other potential suitors but that nothing had eventuated and that shareholders should take no action on the Peabody bid.

A recommendation from the Macarthur board is expected before the end of the month.

Mr Svec said Macarthur's inability to hit production targets in four of the past five years was indicative of either poor forecasting, poor operations, or both.

Peabody had begun to receive some acceptances for its offer, Mr Svec said.

But it is only a trickle at this stage and has not strengthened the Peabody/Arcelor stake in Macarthur more than one percentage point beyond the 16 per cent it was at when the bid was lobbed a month ago.

Macarthur Coal announces year end result

Thursday, 25 Aug 2011

The Board of Macarthur Coal Limited announced a record Net Profit After Tax of AUD 241.4 million for the twelve months ended June 30th 2011. This result was in line with earlier NPAT guidance issued by the Company.

The key financial results for the 2011 financial year include:

Ms Nicole Hollows CEO and MD of Macarthur Coal said that “The past twelve months have been extremely difficult, with our operations being substantially impacted by the record rainfall in the Bowen Basin. Force majeure was declared under coal sales contracts for five months as operations were severely disrupted.”

She said “In spite of the reduced production Macarthur's underlying NPAT was marginally better than last year due to the record prices achieved for metallurgical coal in the final quarter of the year. The profits realized on the sell down of Macarthur's interests in Middlemount, under a pre existing option to Gloucester Coal and Codrilla to our existing Coppabella and Moorvale Joint Venture partners speaks to the quality of Macarthur's asset portfolio."

Ms Hollows said that "Looking forward, the impact of the wet weather will continue to be felt in the upcoming year as Coppabella and Moorvale return to normal operations. Due to the restrictions on permitted water discharge volumes, we have retained water in some pits and our two operating mines ended the year with reduced in-pit inventories and reduced pre-strip. As a result of these conditions it is likely that Macarthur's attributed share of sales produced from Coppabella, Moorvale and Middlemount in the twelve months to June 30th 2012 will be between 5.0 million tonne.”

"As a result of the additional expenditure required to restore the pits to normal operations our FOB costs per tonne are also forecast to be higher in the coming year, rising from around AUD 100 per tonne in FY2011 to around AUD 115 per tonne in FY2012. We expect to return to more typical production cost levels once the mines are restored to normal operating conditions."

"On a more positive note we are now accelerating the activity around the development of Codrilla, our fourth mine. We anticipate that we will obtain the mining lease by July 2012 and our focus in the next twelve months will be to prepare for the commencement of development shortly thereafter, enabling Macarthur to reach its target of 9.2 million tonnes per annum by 2014. We have the coal resource, the long-term port and rail infrastructure and the people necessary to deliver this project. We are on track to deliver sustainable growth."

Japanese regulator clears Peabody ArcelorMittal bid for Macarthur Coal

Thursday, 25 Aug 2011

Japan's competition regulator has cleared a USD 5 billion hostile bid for Australia's Macarthur Coal by Peabody Energy and ArcelorMittal.

Macarthur is resisting the AUD 15.66 a share offer, which includes Macarthur's final dividend. Macarthur considers the offer too low and is due to respond to it by September 1.

(sourced from Reuters)

Australia's Macarthur Coal meets forecasts, in bid talks

Aug24, 2011

* Says bid talks may yield better offer
* Year operating profit inches up after floods
* Warns costs to go up 15% in FY2012 on flood impact
* Shares hold 0.8% above bid

MELBOURNE, Aug 24 (Reuters) - Australia's Macarthur Coal , facing a $5 billion takeover offer, is in talks on potential counteroffers, it said on Wednesday, after meeting forecasts for a slight increase in annual operating profit as it was hit by floods.

Peabody Energy and ArcelorMittal have made a A$15.50 a share offer, which Macarthur is due to respond to by the end of next week. Any white knights would have to show their hands by then.

"Macarthur notes that it is in continuing discussions with a number of interested parties in relation to possible alternative proposals that may result in a superior offer to shareholders," the company said.

Anglo American is studying Macarthur's books for a possible counterbid, sources familiar with the matter have said. However, sources played down media reports of a possible tie-up between Anglo and China's Citic Group, Macarthur's top shareholder with a 24.5 percent stake.

Macarthur's shares closed at A$15.62 on Tuesday, less than 1 percent above the offer price, suggesting investors doubt a higher offer will emerge.

It declared a final dividend of 16 cents a share, in line with Peabody and ArcelorMittal's offer, which was to be reduced by the amount above 16 cents.

Macarthur's profit before one-offs rose to A$142.4 million ($149 million) for the year to June from A$139.1 million a year earlier. That compared with analysts' forecasts around A$144.6 million, according to Thomson Reuters I/B/E/S.

Its second half profit was hit by a five-month disruption to coal production after heavy rains and flooding in Queensland, saved only by record prices for coal used in steel-making.

Macarthur warned output at two of its mines would take some time to return to normal due to water discharge restrictions, and operating costs would rise by 15 percent to $115 per tonne in the year ahead as it restored the pits to normal.

Macarthur's net profit including the sell down of its Middlemount and Codrilla stakes nearly doubled to A$241.4 million.

No EC review for Macarthur Coal takeover

August10, 2011 | AAP

The European Commission does not need to review the planned takeover of Macarthur Coal by US giant Peabody Energy and the world's biggest steel maker, ArcelorMittal, the joint bidders say.

In a statement on Wednesday the bidders said they had been informed by the commission's directorate general for competition that the EU Merger Regulation does not apply to the all-cash $4.7 billion bid for the Queensland-based miner.

The offer was conditional on, among other things, the European Commission confirming that the offer did not fall within its jurisdiction.

The bidders currently have a 16.1 per cent stake in the target, representing ArcelorMittal's interest.

Macarthur last week rejected the hostile $15.50 per share bid after the parties were unable to agree on conditions for a sweetened $16 a share offer, with the target accusing ArcelorMittal and Peabody of imposing unreasonable restrictions.

Shares in Macarthur were up 47 cents, or 3.19 per cent, at $15.19 at 1240 AEST.

Cash rich miners could turn more hostile on acquisition deals

Friday, 05 Aug 2011

Reuters reported that deal advisers warn to expect more hostile deals in resources as cashed up miners turn desperate to snare targets, following Peabody Energy and ArcelorMittal's change of tack this week on their USD 5.3 billion bid for Macarthur Coal.

The pace of resources deals has picked up in recent weeks, putting the sector on track to top a record USD 120 billion in transactions this year, Ernst & Young predicts.

Deals are being fuelled by miners anxious to deploy the spoils from booming commodity markets, with some being forced to move into new sectors or regions, as the number of top tier assets available grows thin.

Mr Tim Day, head of UBS's Perth office, told Reuters that "There are fewer and fewer world class assets out there, so as people get more and more desperate, they may have no choice but to go hostile."

Knowing that suitors are hungry, takeover targets with bullish expectations are holding out for strong offers, while weak equity markets have depressed their shares, making it harder for deals to be sealed.

To help close that valuation gap and get deals done, suitors may have to go hostile, like Peabody and top steel maker ArcelorMittal in their chase for Australian coal miner Macarthur.

Mr Paul Murphy, Asia Pacific mining and metals transactions leader at Ernst & Young, told reporters that "With all the takeovers announced, pretty much all of them have been friendly. That could change."

Mr Day said Australia may still be attractive for Chinese gold investors, like Zijin Mining, China's top gold producer, which has bought just under 17% of Norton Gold Fields, potentially as a beachhead for further offshore expansion.

He said that "Australia makes a lot of sense for Chinese investors from a time zone perspective and offshore investment in gold assets aligns with their strategic diversification away from US dollars."

He predicted there would be more cross border deals in the gold sector, in contrast to the past year, dominated by deals done within Australia and Canada, like Kinross Gold's USD 7 billion takeover of Red Back Mining.

(Sourced from www.reuters.com)

Macarthur Coal asks shareholders take no action on Peabody, Arcelor Mittal bid

Thu Aug 4, 2011

SYDNEY Aug 4 (Reuters) - The board of Australian miner Macarthur Coal has not decided on a A$4.7 billion ($5,01 billion) takeover offer received from Peabody Energy and ArcelorMittal and continued to ask shareholders to take no action on the bid.

Macarthur said in a statement on Thursday that it was still in talks with other parties to elicit a rival bid.

Peabody, the largest U.S. coal company, and ArcelorMittal, the world's top steel-maker, have failed to seal an agreed takeover with Macarthur, which is coveted for its supply of pulverized coal, a key steel-making ingredient.

Instead, the pair of bidders has gone direct to Macarthur shareholders with an offer of A$15.50 a share in cash, plus a 16 cent dividend. Macarthur shares last traded at A$15.78. ($1 = 0.935 Australian Dollars)

Fears for industry recovery as 75% of Queensland coal mines still pumping rainwater

Mar03, 2011

Perth, Australia(Platts) - Three-quarters of Queensland, Australia's coal mines are still pumping rainwater from their open-cut pits and coal producers are growing concerned at the effect more forecast rainfall could have on the industry's recovery, coal industry body the Queensland Resources Council said Thursday.

"Three-out-of-four coal mines are still working to remove water from their properties under special environmental discharge approvals from the state government," QRC chief executive Michael Roche said in a statement.

There are 57 operational coal mines in Queensland including export and non-export mines, according to the QRC an industry body that represents coal miners in the Australian state including Anglo American, BHP Biliton, Macarthur Coal and Rio Tinto. Three-quarters of the total means 42 or 43 coal mines being out of action.

"These special discharge approvals are of limited benefit without the right rainfall pattern, and there is growing concern over the outlook for continuing rain in the coal regions and the possible formation of another tropical cyclone," Roche said.

He said the prospect of more heavy rainfall in central Queensland's coal producing area could hamper existing efforts to pump out rainwater that had collected in open-cut pits.

"What can be pumped off a site can be replaced just as quickly by such rainfall, and your flooded coal pit is then right back to square one of the business recovery phase," added Roche.

Queensland's Department of Environment and Resource Management has taken a strict approach to the discharge of rainwater that has collected in open-cut mines in the state.

The department received 41 applications during December 2010 and January 2011 for new or amended Transitional Environmental Programs enabling mines to safely discharge water, and a further 16 applications were under assessment, DERM said in a February 11 statement issued to Platts.

DERM said it was aware of "31 potential breaches of environmental authority conditions for mines across the state this wet season" and pledged to investigate every one of these cases "with particular attention to whether the situation could have been avoided or minimized through better on site preparation or water management infrastructure."

QRC said in its statement that latest coal export data for the month of February 2011, two months after the state received its heaviest rainfall, revealed that the Queensland coal industry was presently operating at around two-thirds of its production capacity compared with 12 months ago.

The industry figures show that 8 million mt of coal exports were shipped from Queensland in February 2011, compared with 12 million mt of exports in February 2010.

"This is only one month's worth of exports, but the numbers are consistent with company reports and the QRC's own estimates of a 30 million mt downturn in coal production in 2010-11 caused by wet season floods," said Roche.

Production losses stemming from the recent flooding event in the Australian state are forecast to reach "at least A$5 billion (US$5 billion) this financial year" the QRC said in its statement. (By Platts)