Commodities trader Noble Group owns 87.7% of Gloucester, courtesy of its $7 per share cash takeover last year, and made a $12.60 cash offer for the remaining Gloucester shares yesterday.
This is a contingency move, with the Noble offer subject to Macarthur’s bid for Gloucester not proceeding.
Macarthur’s board has already rejected Peabody’s $14 per share offer, but Peabody does not believe the board provided its shareholders with enough information on the deal.
The Takeovers Panel has made no commitment to take any action at this stage, but said Peabody was seeking an interim order that Macarthur postpone the shareholder meeting on April 12 regarding Macarthur’s offer for Gloucester.
Peabody also wants Macarthur to make additional disclosures on the bids, including an updated independent expert’s report on the Gloucester offer which could give Noble almost a quarter of Macarthur’s shares.
Macarthur’s offer for Gloucester contains scrip and cash options, and the current independent expert’s report has established a minimum base case of Noble earning a 20.7% stake in the new Macarthur entity, while the maximum case had the Hong Kong-based company gaining a 24.6% stake.
Back in January, Macquarie Research analysts forecast Noble would eventually launch a full takeover play for Macarthur. The commodities trader is hostile to Peabody’s offer, asking for the “Americans to go back home” in its first reaction.
Should the Gloucester takeover proceed, Macarthur will control Gloucester’s operating Coppabella and Moorvale mines in Queensland’s Bowen Basin along with the Stratford and Duralie mines in the Gloucester Basin of New South Wales.
Macarthur also seeks to gain Noble’s stake in the Middlemount Coal joint venture under the Gloucester offer, with the Queensland company intending to kick off the stage 2 expansion of the mine in mid-2011.
Production capacity at the coking and pulverised coal injection coal mine is expected to double to 3.6 million tonnes per annum for the first year before reaching 5.4Mtpa for the next 19 years.
Macarthur’s run-of-mine production reached 5.79Mt in 2009 from its Coppabella and Moorvale mines, while Gloucester’s total ROM production was 1.51Mt.
Peabody is a major Queensland coal producer with five operations in the state – the North Goonyella longwall mine and the Burton, Eaglefield, Millennium and Wilkie Creek open cut mines.
The company recently applied for federal government environmental approval of an expansion to Wilkie Creek in the Surat Basin, to lift raw thermal coal production capacity from 2.3Mtpa to 10Mtpa.
But Peabody could gain more metallurgical coal export exposure through acquiring Macarthur.
Peabody has majority interests in more than 30 US mines.
Shares in Macarthur are up half a cent to $14.38 this morning, far north of its $12.09 close when Peabody entered the fray before the Easter weekend.
