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Peabody, ArcelorMittal Receive Regulatory Clearance for Macarthur Takeover
10/14/2011 - Peabody Energy and ArcelorMittal have received clearance from the Ministry of Commerce of PR China to proceed with the A$16.00 per share cash offer for all outstanding shares of Macarthur Coal Ltd.
Peabody Energy and ArcelorMittal have received clearance from the Ministry of Commerce of the People’s Republic of China (MOFCOM) to proceed with the A$16.00 per share cash offer for all outstanding shares of Macarthur Coal Ltd. This clearance was the final remaining regulatory condition to be satisfied prior to completion of PEAMCoal’s offer.
“This action from MOFCOM now clears the way for us to complete this transaction in a timely manner,” said Peabody Energy Chairman and CEO Gregory H. Boyce. “Our offer has been recommended by all the participating members of the Macarthur Board and is a substantial premium of 44% to the closing price on July 11, just before our proposal was made public.”
Aditya Mittal, CFO and Member of the Group Management Board at ArcelorMittal, said, "It is now three months since we submitted our initial proposal for Macarthur. Our offer remains the only one before Macarthur shareholders, and we urge them to accept without delay or risk missing out on a substantial premium for their investment.”
PEAMCoal also has established an Institutional Acceptance Facility (IAF) that allows eligible institutional Macarthur investors that do not wish to accept the offer until it has become unconditional to indicate their intention to accept prior to the offer becoming unconditional. PEAMCoal also will pay broker handling fees to brokers who initiate valid acceptances of the offer in respect of parcels of Macarthur shares held by Macarthur’s retail shareholders.
PEAMCoal currently has a relevant interest in Macarthur of approximately 22.78%. Its offer is scheduled to close on 28 October 2011, unless extended.
Participating members of the Macarthur Board have recommended that Macarthur shareholders accept the PEAMCoal offer, in the absence of a superior proposal. The PEAMCoal offer values the equity in Macarthur at approximately A$4.8 billion.
Macarthur Coal is a leading producer of low-volatile PCI metallurgical coal with production and development assets in the Bowen Basin, Australia, including the Coppabella and Moorvale Joint Venture, Middlemount and Codrilla. It holds total coal reserves of 270 million tonnes and total resources of approximately 2.3 billion tonnes.
Peabody Energy is the world's largest private-sector coal company and a global leader in clean coal solutions. With 2010 sales of 246 million tons and nearly $7 billion in revenues, Peabody Energy fuels 10% of U.S. power and 2% of worldwide electricity.
ArcelorMittal is the world’s largest integrated steel and mining company, with operations in more than 60 countries. In 2010, ArcelorMittal had revenues of US$78 billion and crude steel production of 90.6 million tonnes, representing approximately 6% of world steel output. That same year, ArcelorMittal’s mining operations produced 47 million tonnes of iron ore and 7 million tonnes of metallurgical coal.
