South 32 has announced that the proposed acquisition of the Metropolitan Colliery and associated 16.67% interest in the Port Kembla coal terminal from an Australian subsidiary of Peabody Energy will not go ahead.
On 23 February 2017 the ACCC issued a statement of issues, concerned that the proposed acquisition may substantially lessen competition in the supply of metallurgical coal to Australian steelmakers.
South 32 has always maintained that metallurgical coal is a traded commodity. Given this, South 32 is not prepared to make significant concessions in favour of Australian steelmakers that would likely make competition concerns.
South 32 Officer CEO Grahan Kerr said: ‘Our approach to acquisitions is always opportunistic and seen through the lens of creating value for shareholders.”
“To proceed with the acquisition, in the light of the anticipated concessions, would have compromised the merits of the transaction and this is not something we are prepared to do.”
Read the article online at: https://www.worldcoal.com/coal/18042017/acquisition-of-the-metropolitan-colliery-will-not-proceed-south-32-says/