Peabody starts due diligence on Macarthur
There is much anticipation for US-based Peabody Energy as it starts its due diligence today on its $4.1 billion takeover bid for Macarthur Coal.
Both companies last night agreed to five-working days of due diligence, which will be due Wednesday next week since next Monday is declared Anzac Day.
Peabody lifted its bid to $16 a share from the original $13 a share on Friday, causing Macarthur to halt its planned $1 billion takeover bid with Noble Group's Gloucester Coal.
Macarthur confirmed yesterday it will invite other bidders who are interested for bidding negotiations now that Gloucester deal will not push through.
Under the Gloucester deal, Macarthur was not permitted to solicit other bids.
Last Monday, Hong Kong-based Noble Group pulled the plug on its fight for Macarthur Coal.
Noble disclosed to the media its frustration over the bidding war and shareholders' decision to back out of the plan to sell its Gloucester Coal business to Macarthur Coal.
If the deal pushed through, Noble would be receiving a 24 per cent stake for every Macarthur's stake.
"Noble Group wishes to announce that the merger proposal between Macarthur and Gloucester was soundly defeated by shareholders," a Noble statement said.
Noble's move last Monday was triggered by Macarthur's decision to postpone a shareholder's vote after US giant Peabody Energy revised its takeover bid for the third time.
Macarthur said it will consider the consequences of its decision on the Gloucester bid.
Media reports also revealed that Anglo-Swiss miner Xstrata made contacts with Macarthur's three big shareholders - Citic Group, ArcelorMittal, and Posco - on an alternative cash or scrip bid.
However, Macarthur refuted reports, saying that Xstrata did not approach the board over the matter.
Macarthur's shares rose to 14c to $16.68 yesterday. It was reported as the company's highest price before the global financial crisis hit.