Macarthur drops CITIC deal
Queensland-based coal mining company Macarthur Coal Ltd (ASX: MCC) has abandoned a $110 million deal to buy out CITIC Resources' interests after some minority interests failed to give up their pre-emptive rights in the project.
Macarthur announced it had talked with CITIC to terminate the deal involving the Coopabella and Mooravel joint venture.
The coal miner was to issue 11.3 million of its own shares at $9.70 per share in return for CITIC's interests.
Its shares closed at $13.42 on Monday.
Aside from acquiring shareholder approval by September 30, the conditions of the failed deal included all participants in the joint venture waiving pre-emptive rights.
Macarthur, however, said in a statement on Tuesday that "to date, some minority participants in the CMJV have not waived the pre-emptive rights in relation to the CITIC Transaction.
"Macarthur and CITIC have agreed to terminate the CITIC Transaction on the basis that waivers of pre-emptive rights from all CMJV minority participants have not been forthcoming," Macarthur said.
"Accordingly, the shareholders meeting to consider and approve the CITIC Transaction will no longer be required."
The rationale for the CITIC transaction "remains sound and is in line with the future growth direction and vision of the company to be Australia's leading independent coal company," said Macarthur chief executive officer and managing director Nicole Hollows.
"Macarthur is committed to review and assess similar opportunities should they arise in the future."