Macarthur rejects Peabody offer
Macarthur Coal Ltd rejected the revised $3.81 billion offer of US-based Peabody Energy Corporation.
"The Macarthur board has met today and considered Peabody's further proposal and formed the view that based on the price and the conditions of the proposal, that it cannot reasonably be recommended to shareholders," Macarthur said in a statement
Last week, Peabody Energy revised its previous $16 a share bid to $15, valuing Macarthur Coal at $3.8 billion, reducing its previous takeover offer by $300 million. Peabody cited the possible impact of the planned super-profits tax on Macarthur's operation.
Since the government has announced a plan that could raise taxes on resources sector, Macarthur shares have fallen to $13.69. In April, Macarthur's share rose to as high as $16.71 as talks of acquisition and merger heightens.
Shares in Macarthur slumped $1.65, or 12.4 per cent, to $11.68 at 11.30am (AEST) on Tuesday.
Macarthur said its decision to reject Peabody's offer considered feedback from its two largest shareholders, China's CITIC and ArcelorMittal.
"The Macarthur board has also consulted with its two largest shareholders and based on feedback received, considers that a scheme of arrangement in the form proposed (which requires the approval of 75 per cent of shares voted and 50 per cent of shareholders votes) is unlikely to be approved," Macarthur said. "CITIC believes that the long-term strategic value of Macarthur Coal exceeds by a significant margin the cash offer price contained in (Peabody's revised takeover bid)."
Macarthur said its board thought there was no basis for further talks with Peabody about its current proposal.