(Reuters) - Australia’s Stanmore Coal (SMR.AX) on Wednesday said it had received a takeover proposal from privately held Winfield Energy valuing the coal miner at up to A$435 million ($292 million).
The offer represented a premium of up to 36.5% to the company’s last close, with an indicative price between A$1.50 and A$1.70 per share in cash.
Stanmore's high-grade coking coal deposits, strong production and existing infrastructure in the northern state of Queensland have this year attracted would-be suitors such as Golden Energy and Resources Ltd (GOLD.SI). (reut.rs/2YPUaDE)
Its shares jumped 21% to post their biggest daily gain in nearly two years, touching the lower-end of the proposed bid range at A$1.510.
Privately held Winfield Group has boosted its coal exposure this year, buying a 12.5-percent stake in Queensland’s Rolleston thermal coal mine from Japanese trading house Itochu in February, which gives it access to 2 million tonnes a year of thermal coal.
It is run and owned by former executives of top U.S. coal producer Peabody Energy (BTU.N), including Managing Director John Canavan and Executive Chairman Rob Hammond.
Banks have been pulling back from lending to thermal coal projects due to climate change concerns and investor pressure. A buyout of Stanmore Coal would turn Winfield into a majority coking coal producer, potentially making finance easier to access.
Winfield Energy said it was currently working with its debt and equity financiers to negotiate financing to acquire all shares on issue. It did not specify who its financiers were.
The disclosure comes after Stanmore’s top shareholder Golden Investments (Australia) Pte last month requested board changes including removal of the miner’s managing director and chairman as directors.
Stanmore Coal has appointed Allens Linklaters and Citi as its advisors throughout this process. Winfield Energy has appointed Thomson Geer as its legal advisors for the process.
(This story was refiled to correct day in first paragraph to ‘Wednesday’ from ‘Tuesday’)
Reporting by Niyati Shetty and Devika Syamnath in Bengaluru; Additional reporting by Melanie Burton in Melbourne; Editing by Sherry Jacob-Phillips, Shounak Dasgupta and Joseph Radford