The offer allowed Coalworks shareholders to eliminate the risk associated with the development of its assets and funding uncertainties in exchange for an attractive cash payment now, Whitehaven managing director Tony Haggarty said.
“We believe our offer provides a compelling value proposition for Coalworks shareholders compared to the option of continuing to hold an investment in the company,” he said.
“The acquisition of Coalworks represents a logical next step for Whitehaven which will allow Whitehaven to consolidate its development and exploration portfolio.
“Our offer reflects an attractive premium relative to the recent trading prices of Coalworks shares, particularly given the Coalworks share price already reflects takeover speculation.”
Whitehaven said the $1 per Coalworks share conditional offer represented a 17% premium to $0.855 per share, Coalworks’ last closing price on May 4.
Whitehaven’s $491 million scrip acquisition of Nathan Tinkler’s Boardwalk Resources delivered the company a 17.3% interest in Coalworks.
Coalworks appointed a corporate advisor as it seeks to avoid being trampled in the merger between its major shareholder Boardwalk Resources, Whitehaven Coal and Aston Resources.
The New South Wales coal junior, which was the subject of a boardroom coup engineered by Tinkler in November, has appointed independent corporate advisory firm Pitt Capital Partners.
One of the conditions of the offer is that Coalworks provides confirmation that its “strategic advisory” arrangement with Noble announced on April 5 can be terminated without Coalworks being required to pay any material termination fee.
Coalworks has three projects in NSW – the Vickery South project in the Gunnedah Basin, the Ferndale project in the Hunter Valley, and the Oaklands project in the southwest of the state.