Rio approves Yancoal’s acquisition of Coal & Allied
July 5, 2017, 9:38 pm |
Rio Tinto shareholders have approved Yancoal Australia’s acquisition of its subsidiary, Coal & Allied Industries, which owns majority shares in the Hunter Valley, Mount Thorley and Warkworth coal mines.
Chinese owned Yancoal lodged a $US2.45 billion ($3.23 billion) offer for the Hunter Valley assets, which gained Foreign Investment Review Board (FIRB) approval in April 2017.
Last month, Glencore launched a higher bid for Coal & Allied, offering $US2.55 billion ($3.35 billion). This prompted Yancoal to increase its offer, adding $US240 million in royalty payments and an increased break free to its previous $US2.45 billion cash bid.
Rio then recommended its shareholders back Yancoal as a result of the improved bid.
The current shareholder approval means Rio can no longer consider competing proposals for Coal & Allied.
Yancoal chairman Xiyong Li said, “This is a very positive result for our business and we are pleased that the Rio Tinto shareholders have now endorsed our compelling transaction for the tier one Coal & Allied assets.”
“Rio’s support for the acquisition signals the next stage in our strategic growth.”
Yancoal aims to complete the acquisition by the third quarter of 2017.
Last modified on July 3, 2017, 9:39 pm