Poland’s coal miner Bogdanka rejects $1.2-bn takeover bid from NWR
21 Oct 2010
Polish coal miner Lubelski Wegiel Bogdanka SA today rejected a $1.2-billion takeover bid from Czech Republic's New World Resources (NWR), saying it significantly undervalued the company.
On 5 October NWR, headquartered in The Netherlands and listed on the London, Prague and Warsaw stock exchanges had made a fully funded all-cash offer of PLN 100.75 per Bogdanka share, or $1.2 billion (€857 million), a premium of 13 per cent to the closing price of Bogdanka on 4 October 2010.
NWR, which is Central Europe's leading hard coal and coke producer, said that the proposed acquisition is consistent with its strategy of maintain its market leading position in the Central European region by actively pursuing growth opportunities in Poland and the rest of Central and Eastern Europe.
Puchaczow, Poland-based Bogdanka, the country's only publicly traded coal mining company rejected the offer saying that said the offer is too low and NWR has not taken into account the full impact of its ongoing investments.
It also said that NWR's offer does not contain appropriate premium for control of the Bogdanka, which is the largest and most efficient in terms of unit cost of coal production in Poland, and whose experience and technological advantage are important component of the proposed takeover.
"We believe that the price proposed in the offer is extremely low. Our investment plans are in the last phase of implementation and we believe production will double and shareholders will see significant growth in the value of their shares. We think it would be completely wrong for anyone to consider or risk abandoning Bogdanka's ongoing investment plan," said Miroslaw Taras, president of Bogdanka.
