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MacArthur Coal rejects revised bid from Peabody

World Coal,

MacArthur Coal has rejected the new take-over bid from Peabody Energy, the new proposal offered US$ 15 for each share; the new lower valuation came about as a result of the proposed resource tax in Australia which has caused a drop in the value of mining companies shares across the board. Peabody revised their original take-over proposal after MacArthur Coal’s shares dropped by 15%.

Peabody was willing to allow all three major shareholders in the company, CITIC, ArcelorMittal and Posco to retain their stakes in MacArthur Coal if they wished.

However, the board of MacArthur decided that it would not recommend that shareholders endorse the proposal. CITIC, the largest shareholder had this to say, “CITIC does not find the proposal attractive, CITIC believes that the long term strategic value of MacArthur Coal exceeds by a significant margin the cash offer price contained in the proposal.”

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