Australia’s Macarthur Coal yesterday backed a revised takeover offer from US firm Peabody Energy and Europe’s ArcelorMittal, which values the company at A$4.83 billion (US$5.14 billion).
The pair raised their bid to A$16 for each Macarthur share from their previous A$15.50 a share.
“The Macarthur board now recommends the revised PEAMCoal offer, in the absence of a superior proposal,” the company said in a statement, urging shareholders to accept. “Although it remains possible that a superior proposal might be made, none have emerged to date and there can be no assurances that any will emerge.”
Under the banner PEAMCoal, Peabody and ArcelorMittal launched a hostile takeover bid on Aug. 1 after Macarthur refused to back their initial friendly offer made on July 11.
Peabody and Arcelor, respectively the world’s largest listed pure-play coal miner and the world’s biggest steelmaker, say the bid needs the support of Macarthur investors holding 50.1 percent of shares to succeed.
Arcelor already owns 16 percent of the company.
This means that Peabody and Arcelor do not necessarily need the support of China’s Citic Resources Holdings Ltd (中信資源控股) and South Korea’s Posco Ltd, which own 24.6 percent and just over 7 percent of Macarthur respectively.
“This is a major step forward in our acquisition process,” Peabody Energy chief executive Gregory Boyce said. “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.”
ArcelorMittal chief financial officer Aditya Mittal added: “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.”
Macarthur, the world’s largest miner of pulverized coking coal used as a low-cost input in steelmaking, last week announced its full-year net profits rose 93 percent to A$241.4 million, in part because of surging commodity prices.