Macarthur Coal's legal department has been busy. It's now hired external counsel to assist it with a string of deals.
Today's announcement that it had struck a deal with ports and rail operator Asciano Group, which will allow Asciano to move seven million tonnes of coal each year from two of the miner's Queensland operations, is just the latest in a string of major strategic moves for the company.
The company led gains amongst Australian mining companies after a report showed US manufacturing rose more than economists had previously estimated. It boosted optimism around demand for metals and energy.
But there is a reason Macarthur stocks climbed 13 per cent this week, its biggest gain since June.
The company has been using external legal counsel Corrs Chambers Westgarth on deals it said would increase the company's holdings and solidify its position as one of Australia's top independent coal producers.
Macarthur announced in late December 2009 an intention to acquire 100 per cent of Gloucester Coal Ltd via an off-market takeover by an all-scrip offer with cash alternative.
At the same time as the Gloucester takeover announcement, Macarthur also announced that it had entered into a conditional binding term sheet to acquire Noble Group Limited’s interest in the Middlemount joint venture, taking Macarthur’s ownership to 100 per cent of Middlemount including all marketing rights for Middlemount product.
The company also announced that it was continuing discussions with Noble to acquire a majority stake in Donaldson Coal Holdings Ltd.
Finally, Macarthur announced that it had entered into a conditional binding term sheet to acquire the 7 per cent interest held by Macarthur’s largest shareholder, CITIC Resources, in Macarthur’s Coppabella and Moorvale joint venture.
Macarthur has since announced that it has now entered into definitive legal documentation with Noble in relation to the Middlemount transaction and that the Donaldson transaction is not proceeding.
The Middlemount transaction will remain conditional upon FIRB approval, the Gloucester offer becoming unconditional and Noble accepting the Gloucester offer.
To date, Corrs has advised on the structure and terms of the proposed takeover of Gloucester and the transactions with Noble and CITIC as well as conducting due diligence investigations in relation to the proposed acquisitions.
Corrs partner Teresa Handicott said: “This transaction has been significantly more logistically challenging and technically complex than most takeovers as a result of the number of separate transactions and the unusual situation that some of them are with Gloucester’s major shareholder.
"There are very few examples of public takeovers with separate transactions with a shareholder of the target, partly due to the legal and regulatory issues involved.”
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