Big plans were laid for Blackwood
But when taking the stand, Nathan Tinkler made clear there was a much bigger plan, backed by Noble Group, including the $400 million acquisition of the underperforming Australian coal assets of Brazilian mining giant Vale.
In the wake of the April merger of his Aston Resources and Boardwalk Resources with listed Whitehaven Coal, Mr Tinkler and Noble, which was rolling its Gloucester Coal assets into the separately-listed Yancoal, planned to turn Blackwood into a substantial company. The share placement to Mulsanne - at a hefty 50 per cent premium to the company's then share price - was just the start. "The whole reason [for the placement] was to grow Blackwood," Mr Tinkler said on Thursday.
The idea was to marry Tinkler Group's skills in greenfields development with Noble's skills in commodity marketing. The putative deal, which could also have involved listed junior Guildford Coal, unravelled as coal markets turned adverse in the second half of 2012 and coal stocks fell, making it tougher to raise finance. "Noble didn't expect Yancoal shares to be under $1 and I didn't expect Whitehaven to be trading at $3," he said.
By the end of last year, Mr Tinkler said Noble was a "company under stress" and around October it came back and offered half the previously discussed valuation for the Middlemount royalty. The offer was rejected and alternatives considered. Potential financiers were approached, including hedge fund Och Ziff - which has a stake in Guildford - and investment bank Barclays.
Whitehaven shares struck a fresh low of $2.31 on Thursday, valuing Mr Tinkler's 19.4 per cent stake at just $454 million, while Yancoal shares were at 84.5¢.
Frequently Asked Questions about this Article…
The article says Blackwood attempted a $28.4 million placement to Mulsanne that failed. That placement was part of a broader plan to grow Blackwood and was intended as the first step in a larger deal; it ultimately unravelled as coal markets turned adverse and raising finance became harder.
Nathan Tinkler told the court the placement was only the start of a much bigger plan backed by Noble Group, including a proposed $400 million acquisition of underperforming Australian coal assets from Vale and using Tinkler Group’s greenfields development skills combined with Noble’s commodity-marketing expertise.
Noble was a strategic backer in the proposed plan: it was rolling its Gloucester Coal assets into Yancoal and intended to partner with Tinkler by providing commodity-marketing capabilities to complement Tinkler Group’s development skills in Blackwood’s growth strategy.
According to the article, coal markets turned adverse in the second half of 2012, coal stocks fell, and that made it tougher to raise finance. Noble itself came under stress and later offered a much lower valuation for the Middlemount royalty, prompting rejection and searches for alternative financiers.
By around October, Noble reportedly returned with an offer valuing the Middlemount royalty at about half the previously discussed level. That reduced offer was rejected and other financing options were explored.
The article says potential financiers that were approached included hedge fund Och Ziff—which had a stake in Guildford Coal—and investment bank Barclays.
The article notes Whitehaven shares hit a fresh low of $2.31, which valued Tinkler’s 19.4% stake at about $454 million, while Yancoal shares were trading at 84.5 cents, reflecting the broader downward pressure on coal stocks.
Yes. The article describes earlier deals involving the April merger of Aston Resources and Boardwalk Resources with listed Whitehaven Coal, mentions a possible involvement of listed junior Guildford Coal in the putative deal, and the intended $400 million purchase of Vale’s underperforming Australian coal assets.
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