Peabody & ArcelorMittal take over bid for Macarthur Coal

Dear PGM CAPITAL Blog readers,
Today, Monday July 11th 2011, Peabody Energy (NYSE: BTU) and ArcelorMittal SA (NYSE: MT) confirmed that they have jointly submitted an indicative proposal to the board of directors of Macarthur Coal Ltd. (ASX: MCC) to acquire all of the shares of the company.


  • Under the proposal by a newly formed company, owned 60 percent by Peabody and 40 percent by ArcelorMittal, Macarthur shareholders would be offered a cash price of A$15.50 per share through an off-market takeover offer. The new company has a relevant interest of approximately 16 percent in Macarthur’s shares.
  • The proposal price implies a value for the equity in Macarthur of approximately A$4.7 billion and represents a substantial premium to recent trading.

About the Companies involved:

  • Peabody 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 US$7 billion in revenues, Peabody fuels 10 percent of U.S. power and 2 percent of worldwide electricity.
  • ArcelorMittal is the world’s leading integrated steel and mining company, with operations in more than 60 countries. In 2010, ArcelorMittal had revenues ofUS$78 billion and crude steel production of 90.6 million tonnes, representing approximately 8 percent of world steel output. ArcelorMittal’s mining operations produced 47 million tonnes of iron ore and 7 million tonnes of metallurgical coal as well in 2010.
  • Macarthur is the world’s largest producer of seaborne low volatile pulverized coal injection (LV PCI) coal with production and development assets in the Bowen Basin, Australia, including the Coppabella and Moorvale Joint Venture and Middlemount Mine. It controls total coal reserves of approximately 270 million tonnes (approximately 175 million tonnes on an attributable basis) and total resources of approximately 2.3 billion tonnes (approximately 1.7 billion tonnes on an attributable basis). It has current production guidance of 3.8 to 4.0 million tonnes for the year ended June 30, 2011


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