UPDATE 3-Macarthur Coal bid twist: Gloucester deal collapses

* Noble shareholders reject Gloucester sale to Macarthur

* CITIC Resources seeks time to weigh Peabody offer

* Noble likely to take Gloucester private – analyst

* Macarthur shares hold 3 pct above offer price

* Next coal miner takeover on the boil
(Recasts with Noble shareholder vote, analyst comment)

By Sonali Paul and Narayanan Somasundaram

MELBOURNE, April 19 (BestGrowthStock) – U.S. miner Peabody Energy’s
(BTU.N: ) $3.8 billion bid for Macarthur Coal (MCC.AX: ) gained
traction on Monday as one of two rival deals involving the
Australian miner hit the skids.

Shareholders of commodity trader Noble Group (NOBG.SI: )
rejected a proposal to sell a stake in Gloucester Coal (GCL.AX: )
to Macarthur, the world’s leading exporter of a cheaper,
cleaner coal coveted by steelmakers.

Macarthur has recently rejected sweetened bids from both
Peabody and local rival New Hope Corp (NHC.AX: ), favouring a
deal under which it would take over Gloucester, and Noble would
take a one-quarter stake in Macarthur.

“With Noble shareholders having voted down the Gloucester
sale, it has by default cleared a key hurdle for the two
bidders,” said Andrew Pedler, a resource analyst at Wilson HTM.

“The bids lodged by Peabody and New Hope were conditional
on Macarthur not proceeding with the Gloucester takeover.
Macarthur’s board is now free to solicit bids, if they so
choose.”

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For a FACTBOX on pulverised coal: [ID:nSGE638013]

For NEWSMAKER on Macarthur CEO: [ID:nSGE63607A]

For Graphic on China coal imports:
http://graphics.thomsonreuters.com/310/CN_CLIMEX0310.gif

For Graphic on forecast Australian coal exports:
http://graphics.thomsonreuters.com/310/AU_CL0310.gif

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Macarthur’s top shareholder CITIC Resources (1205.HK: )
earlier said it had not yet decided whether to support
Peabody’s A$16 a share offer, which had trumped New Hope’s bid.

CITIC Resources, a founding shareholder of Macarthur with
22.4 percent, had said it supported the rationale for
Macarthur’s takeover of Gloucester, but needed more time and
information to weigh the Peabody offer.

In a brief statement, Noble said its shareholders “soundly
defeated” the plan to sell Gloucester Coal — effectively
taking it out of the running.

Coal producers are chasing Macarthur for its high profile
in pulverised coal, or PCI, sought by steelmakers at a time
when coal prices have nearly doubled on hot demand from China
and India.

Macarthur shares closed flat on Monday, holding at around 3
percent above Peabody’s offer, having been supported last week
by talk London-listed Xstrata (XTA.L: ) may join the fray.

“Peabody’s bid is now close to what will be accepted. It’s
now a question of negotiation unless Xstrata comes in. Then
it’s a different ball game,” said Tom Elliott, head of hedge
fund MM&E Capital.

KEEP STAKE

Under Peabody’s offer, Macarthur’s top three shareholders
— CITIC Resources and steel giants ArcelorMittal (ISPA.AS: ) and
POSCO (005490.KS: ) — would be allowed to retain their stakes.

POSCO, which owns 8.3 percent, backs the deal in principle
and says it plans to keep its stake for now, while
ArcelorMittal, with 16.6 percent, says the bid merits
consideration.

The two steel producers bought into Macarthur two years ago
at A$20 a share, when it was being chased by Swiss-based
Xstrata, as they sought to ensure the company did not fall into
the hands of a major coal producer.

MM&E’s Elliott said CITIC was more of a financial investor,
noting it, too, had bought into Macarthur at closer to A$20 a
share and would want to hold out for a higher bid.

Macarthur had said on Friday it would enter into talks with
Peabody, and postponed a vote by its shareholders on the
Gloucester deal.

“The rejection from shareholders means that Macarthur and
Noble will go their own way, and Noble is likely to take
Gloucester private,” said a Singapore-based equity analyst, who
declined to be identified.

M&A FEVER

Adding to the flurry of interest in coal miners,
Australia’s White Energy (WEC.AX: ) made a A$39 million cash and
scrip offer for South Australian Coal Ltd (SACL), aiming to use
its own technology to upgrade SACL’s coal for export.

SACL was spun off to Felix Resources shareholders last year
when Felix was taken over by Chinese firm Yanzhou Coal Mining
Co (1171.HK: ) for $3 billion.

White Energy has poached the managing director of Felix,
Brian Flannery, to work alongside Felix’s former chairman,
Travers Duncan, who, with a third investor, plan to invest A$75
million in new SACL shares.

Stock Market Today

(Additional reporting by Neil Chatterjee and Harry Suhartono
in SINGAPORE and Michael Perry in SYDNEY; Editing by Mark
Bendeich and Ian Geoghegan)

UPDATE 3-Macarthur Coal bid twist: Gloucester deal collapses