Shares of Macarthur Coal Ltd surged yesterday after ArcelorMittal, the world's largest steelmaker, bought a 14.9 percent stake in the miner and opened discussions about another transaction.
Macarthur, which supplies more than a third of the world’s pulverized coal, said ArcelorMittal had approached it “in respect of a potential transaction” after recently acquiring its stake in two large trades worth A$632 million (US$606 million), or A$20 per share.
The miner’s shares were up 8.1 percent at A$19.86 in late afternoon trading, after earlier rising as much as 14.1 percent.
ArcelorMittal’s move is the latest in a steady stream of foreign takeover attempts for Australian miners that have been sparked by surging commodity prices.
Speculation about a takeover for Macarthur has been running hot since it said last month it had been approached by a third party about a possible transaction.
Macarthur said yesterday that the party was not ArcelorMittal and that, while talks had been continuing, there was no certainty that a proposal would be made to the board.
Under Australian takeover law, a bidder for a company has to at least match the price it has paid for any stake in its target, meaning any offer from ArcelorMittal will have to be pitched at A$20 or higher.
Macarthur produces the pulverized coal used in steel manufacturing.
ArcelorMittal is already a large buyer of output from Macarthur’s Queensland mines and looks to be acting to lock in supply in a tight market.