Australia miner rejects fresh $3.4-billion offer

HONG KONG — Macarthur Coal, an Australian miner that is the focus of several rival bids, on Friday rejected as inadequate a fresh surprise offer made by a rival Australian miner, New Hope.

In a move that underlined the intense global appetite for Australia’s mineral wealth, New Hope had earlier on Friday joined a bidding war for Macarthur with a $3.4 billion bid that expanded the battle for Macarthur to a three-way global tug-of-war involving rival bids from companies in the United States and Hong Kong.

Macarthur also on Friday postponed a key shareholder vote due Monday to April 19, and said in a statement that it had become aware that an investment bank representing Xstrata, a mining giant based in Switzerland, had approached one of its large shareholders.

Macarthur said it had “no further information about the context or content of that discussion, nor whether Xstrata has any substantive interest in Macarthur or any of its assets.” Xstrata declined to comment.

But the apparent exploratory contact from Xstrata and the three existing offers come on top of a string of other takeovers and deals in the mining and gas sector over the past year, highlighting the strong demand for natural resources like iron and coal as the global economy recovers.

Macarthur, a specialist producer of pulverized coal that is sought after by steelmakers, is one of the last remaining independent mid-size miners in Australia, making it an attractive acquisition target.

New Hope’s offer topped a rival bid, first announced on March 30, by Peabody Energy, a company based in St. Louis. New Hope and Peabody have both been hoping to convince Macarthur to abandon an agreement announced last December for a complex transaction with Noble Group, a commodities company based in Hong Kong.

Even before Macarthur’s statement about Xstrata, which came late in the Australian day, Macarthur’s shares had shot up 8.3 percent to close at 15.55 Australian dollars – well above the per-share bids made by Peabody and New Hope, indicating that investors were betting a higher offer might emerge.

Peabody’s initial bid has since been sweetened to $14 a share, while New Hope on Friday said its all-share offer was worth $14.58 per share.

Macarthur turned down the New Hope offer saying in a statement that it did “not represent an adequate premium for control of the company.” It also stuck with its recommendation to shareholders to approve the transaction with Noble.

Under that deal, Noble would sell to Macarthur various Australian mining assets — notably an 88 percent stake in Gloucester Coal — in return for a 25 percent stake in Macarthur. The shareholder meeting that Macarthur has now delayed until April 19 was due to sign off on that deal, a move that would effectively reject the rival Peabody and New Hope offers.