ArcelorMittal Backs Out Of Macarthur Coal Purchase
October 25 2011 - 9:32AM
Dow Jones News
ArcelorMittal (MT), the world's largest steel maker, said
Tuesday in a surprise announcement that it has decided to backout
of its joint purchase of Australia's coking coal miner Macarthur
Coal Ltd. (MCC.AU).
"ArcelorMittal has determined that it would no longer be
appropriate to allocate substantial capital to the acquisition of a
non-controlling, minority business interest," the company said in a
statement.
"Given the unanticipated level of acceptances into the offer,
ArcelorMittal believes that it is more appropriate to focus its
capital elsewhere in its business," the company added without
disclosing what the unanticipated level of acceptance might be.
ArcelorMittal and the world's largest private sector coal
company, U.S-based Peabody Energy Corp. (BTU), said on Monday that
59.85% of Macarthur's shareholders had accepted their joint $A16 a
share offer.
The two companies, through their joint venture PEAMCoal Pty
Ltd., said the offer would be increased to A$16.25 a share or A$4.9
billion if they managed to get at least 90% of the company by Nov.
11.
The Luxembourg-based company is now tendering its Macarthur
shares to PEAMCoal Pty Ltd., noting that its decision to sell out
of the deal was in accordance with the rights that ArcelorMittal
originally negotiated with Peabody at the time the Co-Operation and
Contribution Agreement was concluded.
ArcelorMittal said PEAMCoal's offer would stay in place and it
will remain a shareholder in PEAMCoal until the termination
arrangements are completed in approximately 90 days' time.
-By Alex MacDonald, Dow Jones Newswires; +44 (0)20 7842 9328;
alex.macdonald@dowjones.com
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