More reports on: M&A, Power
China's Yanzhou acquiring Australia's Gloucester Coal for $2.23 bn news
23 December 2011

Yanzhou Coal Mining Co, China's fourth-biggest coal producer, today agreed to buy Australia's Gloucester Coal Ltd, in a A$2.2 billion ($2.23 billion) cash and stock deal.

Gloucester's board has accepted the deal and urged shareholders to accept the offer, which is conditional on the successful completion of due diligence and an independent expert's report finding that the offer is fair and reasonable.

Singapore's Noble Group, which owns 64.5 per cent of Gloucester, has accepted the offer and said that it would vote for the deal.

Under the complex deal, which values Gloucester at A$10.16 a share, the Australian m iner will merge with Yanzhou's Australian subsidiary Yancoal Australia, and its shareholders will receive a total cash payment of $700 million by way of special dividend and capital reduction, the equivalent of about $3.20 for each Gloucester share.

The transaction will create a new-listed company on the Australian Stock Exchange (ASX) that combines most of Yanzhou's Australian assets with Gloucester's. Post listing, Gloucester shareholders will hold 23 per cent of the company and Yancoal Australia will hold 77 per cent.

Yanzhou also agreed to pay as much as A$3 a share should stock in the new company fall below A$6.96 in the 18 months after the deal closes.





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China's Yanzhou acquiring Australia's Gloucester Coal for $2.23 bn