South32 won't hunt for thermal coal bargains

South32 chief executive Graham Kerr has ruled out bidding for bargain basement thermal coal assets and admitted that commodity prices fell much further than the company expected, according to the Sydney Morning Herald.

While the BHP Billiton spin-off is one of few miners around the world with more cash than debt, Kerr told the Melbourne Mining Club that the mining sector “has a poor track record deploying capital” and South32 would be cautious about making deals to bolster its growth.

“Are we open to external opportunities? Of course we are. So what commodities are we interested in?” Kerr said.

“Naturally, there are some that are more attractive than others. For example, in thermal coal, due to lower demand and oversupply, we wouldn't be keen on acquiring anything new.”

More mining explorers risk administration

The Sydney Morning Herald reports that more resources exploration companies are likely to enter administration if the proposed ASX listing rule changes are implemented, accounting and advisory firm BDO has warned.

The ASX has witnessed a run of backdoor listings as junior resources companies, many of which have been neglected by sophisticated investors due to a downturn in commodity prices, opt to act as listing vehicles for plucky technology hopefuls.

WICET appoints Fort Street in coal restructure

The Wiggins Island Coal Export Terminal (WICET), part-owned by Australia's biggest coal miner, Glencore, has tapped Fort Street Advisers to help devise a $2 billion-plus restructuring plan for the debt-laden facility, according to the Australian Financial Review.

Sources close to WICET said its board had signed off on the appointment of Fort Street in the past few days as it grapples with a prolonged downturn in the coal market. Restructuring expert KordaMentha was also vying for the advisory deal, according to sources.