BREAKFAST DEALS: Linc connects
Linc Energy sells its Galilee Basin coal tenements on third attempt, as questions hang over AWB-GrainCorp merger.
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After two failed attempts, Linc energy finally offloads its coal tenements in the Galilee Basin. Meanwhile, questions are already being asked at how the surprise AWB-GrainCorp merger will get past the ACCC.
Linc Energy, Adani Group
Queensland-based underground coal gasification (UCG) company Linc Energy has reportedly sealed a $1 billion deal with India's Adani Group to offload its coal tenements in the Galilee Basin. The news comes after earlier speculation that the parties were in close talks to secure a deal, which marks the largest investment by an Indian company in the Australian mining sector. The Ahmedabad-based conglomerate is run by 49 year old billionaire Gautam Adani, who has progressively expanded the company's presence in the Indian coal industry and has made no secret of his desire for Australian coal mines. According to The Australian, Adani was in the running for the Curragh mine in Central Queensland last year, which was eventually sold to Wesfarmers. Adani is also seeking additional port capacity at the Abbot Point facility which is the designated exit point for coal from the Galilee Basin. It's a case of being third time lucky for Linc, which had twice failed to sell the tenements, estimated to hold up to eight billion tonnes of coal, to Chinese suitors Yanzhou Coal and Xinwen Mining Group. More importantly, the money from the sale gives Linc the necessary capital to further develop its core coals-to-liquid business. While the Australian mining sector has been awash with Chinese entities moving in to secure access to iron ore, coal and copper, Indian companies have made a much smaller splash. But Adani's $1 billion investment could be a sign of things to come, especially as India's appetite for coal continues to grow. The value of Australian coal exports to India surged to $6.7 billion last financial year and there's a good chance that the beachhead prepared by Adani could pave the way for an even bigger player, Coal India Limited, which is poised to make its debut on the Bombay Stock Exchange in October. Coal India chairman Partha Bhattacharyya, who was in Australia earlier this year, said at the time that it was very much on their hit-list and has since been in talks with Rio Tinto, Peabody and Hancock Prospecting over possible deals.
GrainCorp, AWB
The multibillion-dollar merger between GrainCorp and AWB took the market by surprise last Friday and with investors getting a weekend to get their bearings focus is already shifting to how the two grain handlers intend to make the deal more palatable to the competition watchdog . While the two parties have expressed their confidence of getting the nod from the ACCC, JP Morgan analyst Stuart Jackson has told The Australian that the regulator may ask GrainCorp to sell AWB's half-share in the Melbourne port terminal and possibly push for the sale of the merged group's containerisation assets. Meanwhile, the AFR reports that there may be a chance of an overseas party to play spoiler, with two investment banks running the ruler over AWB and GrainCorp on behalf of offshore parties and Canadian industry giant Viterra widely seen as a strong candidate to launch a bid on AWB. AWB management said on Friday that it had fielded offers form a number of parties as its deal with Gavilon headed south and one analyst told the paper that Graincorp's surprise entry could force Viterra to make a serious offer for AWB. While the deal is widely seen as a positive for AWB, the paper also reports that GrainCorp shareholders are lukewarm on the deal as they ascertain the strategic benefits of the merger.
Sigma Pharmaceuticals, Watson
With South African suitor Aspen Pharmacare still taking its time with its due diligence on Sigma Pharmaceuticals, the takeover target's generics business continues to attract attention. According to The Age, the US specialty healthcare company Watson Pharmaceuticals is pondering a move on the division, valued at about $600 million. California-based Watson is yet to make a formal offer, but the paper adds that the company has been crunching the numbers on Sigma's generics business. Sigma's consumer health business Herron and its Orphan Australia drugs division have already received interest from suitors and the embattled drug maker will hope that the latest news will push Aspen to get a move on with its designs on the company.
WIN Corporation, PBL Media
In the local media scene, WIN Corporation boss Gordon Davis has told the AFR that his company had all the financial muscle it needed to buy PBL Media's east coast Nine Network television stations. The Bermuda-based media baron said the stations would be a good fit for WIN if the Gillard government's proposal to scrap the 75 per cent TV audience rule sees the light of day. That will, of course have to wait until the federal elections are out of the way. Meanwhile, there are signs that the early bonhomie between Mitchell Communications and its new owners Aegis are under strain over the composition of a new management team. The Australian reports that Aegis has been spooked by comments by the new entity's chairman Harold Mitchell that his son Stuart was in line for a top position. While Mitchell has played down any tension, he told the paper that comments about his son's role had been raised "in passing" conversations between the two parties.
Walt Disney, Miramax, Filmyard Holdings
The Walt Disney Company has sold its Miramax Films unit to private consortium Filmyard Holdings for over $US660 million. Filmyard's main partners include US construction magnate Ron Tutor and private equity firm Colony Capital. A source told The Los Angeles Times that Tutor, chairman of construction giant Tutor Perini Corp and Colony Capital, are each expected to invest $US100 million. Additional investors could be tapped in the near future, the paper added. The sale of the film studio includes rights in over 700 film titles, and certain non-film assets, such as certain books, development projects and the 'Miramax' name, Disney said in a statement. The $US660 price tag is in the right ball park for what Disney's boss Robert Iger was seeking for Miramax at a time when the entertainment conglomerate is looking to spread its wings into the social media scene. Disney snapped up social-gaming developer Playdom for $US563 million last week, with hopes of swapping the glitzy lights of Hollywood for the brave new world of Facebook and Twitter.
Wrapping up
US-based fleet industry heavyweight Wright Express Corporation is putting the final touches on a deal to buy the fleet and prepaid card businesses of local outfit Retail Decisions for $353 million. Wright Express, which processes payments for commercial and government trucking fleets, inked the deal over the weekend with Retail Decision's private equity owner Palamon Capital Partners and its co-investors Morgan Stanley Alternative Investment Partners and AlpInvest Partners. The transaction will see Wright Express acquire Retail Decision's prepaid fuel card business, ReD Fuel, and prepaid card processing business, ReD Prepaid, which generated combined revenues of around $61.4 million last year. Wright Express, which expects the acquisitions to add to net income immediately, reportedly fended of stiff competition from offshore bidders. According to the AFR, Wright Express' closest rival Fleet or Technologies was also in the running for the asset. Bank of America Merrill Lynch advised Wright Express, with the sale process managed by Morgan Stanley. There's news of another BP asset on the shopping cart, with the cash-strapped oil major reportedly eyeing a prospective buyer for its German fuel station unit Aral. According to German magazine, Wirtschaftswoche, the unit is expected to fetch a price of two billion euro with European industry stalwarts Total, Avia and Rosneft all interested in the asset. Meanwhile, BP's final push to cap the Macondo well may be ready to bear fruit, but the company is still coming to term with the magnitude of the damage suffered by its brand. The UK's Telegraph reports that owners of as many as 11,300 US petrol stations are considering ditching the BP name in favour of the traditional American Amoco brand. The Queensland government's planned float of its bulk coal rail company, QR National, has taken another step forward with CBA and Wilson HTM named as the lead managers of the listing. Ord Minnett and Patersons will act as co-managers to QR National's float. XRF Scientific Limited has signed a binding agreement to acquire the fusion flux and platinum manufacturing businesses from the Sigma Group of companies. The $7 million consideration is in cash and scrip.
After two failed attempts, Linc energy finally offloads its coal tenements in the Galilee Basin. Meanwhile, questions are already being asked at how the surprise AWB-GrainCorp merger will get past the ACCC.
Linc Energy, Adani Group
Queensland-based underground coal gasification (UCG) company Linc Energy has reportedly sealed a $1 billion deal with India's Adani Group to offload its coal tenements in the Galilee Basin. The news comes after earlier speculation that the parties were in close talks to secure a deal, which marks the largest investment by an Indian company in the Australian mining sector. The Ahmedabad-based conglomerate is run by 49 year old billionaire Gautam Adani, who has progressively expanded the company's presence in the Indian coal industry and has made no secret of his desire for Australian coal mines. According to The Australian, Adani was in the running for the Curragh mine in Central Queensland last year, which was eventually sold to Wesfarmers. Adani is also seeking additional port capacity at the Abbot Point facility which is the designated exit point for coal from the Galilee Basin. It's a case of being third time lucky for Linc, which had twice failed to sell the tenements, estimated to hold up to eight billion tonnes of coal, to Chinese suitors Yanzhou Coal and Xinwen Mining Group. More importantly, the money from the sale gives Linc the necessary capital to further develop its core coals-to-liquid business. While the Australian mining sector has been awash with Chinese entities moving in to secure access to iron ore, coal and copper, Indian companies have made a much smaller splash. But Adani's $1 billion investment could be a sign of things to come, especially as India's appetite for coal continues to grow. The value of Australian coal exports to India surged to $6.7 billion last financial year and there's a good chance that the beachhead prepared by Adani could pave the way for an even bigger player, Coal India Limited, which is poised to make its debut on the Bombay Stock Exchange in October. Coal India chairman Partha Bhattacharyya, who was in Australia earlier this year, said at the time that it was very much on their hit-list and has since been in talks with Rio Tinto, Peabody and Hancock Prospecting over possible deals.
GrainCorp, AWB
The multibillion-dollar merger between GrainCorp and AWB took the market by surprise last Friday and with investors getting a weekend to get their bearings focus is already shifting to how the two grain handlers intend to make the deal more palatable to the competition watchdog . While the two parties have expressed their confidence of getting the nod from the ACCC, JP Morgan analyst Stuart Jackson has told The Australian that the regulator may ask GrainCorp to sell AWB's half-share in the Melbourne port terminal and possibly push for the sale of the merged group's containerisation assets. Meanwhile, the AFR reports that there may be a chance of an overseas party to play spoiler, with two investment banks running the ruler over AWB and GrainCorp on behalf of offshore parties and Canadian industry giant Viterra widely seen as a strong candidate to launch a bid on AWB. AWB management said on Friday that it had fielded offers form a number of parties as its deal with Gavilon headed south and one analyst told the paper that Graincorp's surprise entry could force Viterra to make a serious offer for AWB. While the deal is widely seen as a positive for AWB, the paper also reports that GrainCorp shareholders are lukewarm on the deal as they ascertain the strategic benefits of the merger.
Sigma Pharmaceuticals, Watson
With South African suitor Aspen Pharmacare still taking its time with its due diligence on Sigma Pharmaceuticals, the takeover target's generics business continues to attract attention. According to The Age, the US specialty healthcare company Watson Pharmaceuticals is pondering a move on the division, valued at about $600 million. California-based Watson is yet to make a formal offer, but the paper adds that the company has been crunching the numbers on Sigma's generics business. Sigma's consumer health business Herron and its Orphan Australia drugs division have already received interest from suitors and the embattled drug maker will hope that the latest news will push Aspen to get a move on with its designs on the company.
WIN Corporation, PBL Media
In the local media scene, WIN Corporation boss Gordon Davis has told the AFR that his company had all the financial muscle it needed to buy PBL Media's east coast Nine Network television stations. The Bermuda-based media baron said the stations would be a good fit for WIN if the Gillard government's proposal to scrap the 75 per cent TV audience rule sees the light of day. That will, of course have to wait until the federal elections are out of the way. Meanwhile, there are signs that the early bonhomie between Mitchell Communications and its new owners Aegis are under strain over the composition of a new management team. The Australian reports that Aegis has been spooked by comments by the new entity's chairman Harold Mitchell that his son Stuart was in line for a top position. While Mitchell has played down any tension, he told the paper that comments about his son's role had been raised "in passing" conversations between the two parties.
Walt Disney, Miramax, Filmyard Holdings
The Walt Disney Company has sold its Miramax Films unit to private consortium Filmyard Holdings for over $US660 million. Filmyard's main partners include US construction magnate Ron Tutor and private equity firm Colony Capital. A source told The Los Angeles Times that Tutor, chairman of construction giant Tutor Perini Corp and Colony Capital, are each expected to invest $US100 million. Additional investors could be tapped in the near future, the paper added. The sale of the film studio includes rights in over 700 film titles, and certain non-film assets, such as certain books, development projects and the 'Miramax' name, Disney said in a statement. The $US660 price tag is in the right ball park for what Disney's boss Robert Iger was seeking for Miramax at a time when the entertainment conglomerate is looking to spread its wings into the social media scene. Disney snapped up social-gaming developer Playdom for $US563 million last week, with hopes of swapping the glitzy lights of Hollywood for the brave new world of Facebook and Twitter.
Wrapping up
US-based fleet industry heavyweight Wright Express Corporation is putting the final touches on a deal to buy the fleet and prepaid card businesses of local outfit Retail Decisions for $353 million. Wright Express, which processes payments for commercial and government trucking fleets, inked the deal over the weekend with Retail Decision's private equity owner Palamon Capital Partners and its co-investors Morgan Stanley Alternative Investment Partners and AlpInvest Partners. The transaction will see Wright Express acquire Retail Decision's prepaid fuel card business, ReD Fuel, and prepaid card processing business, ReD Prepaid, which generated combined revenues of around $61.4 million last year. Wright Express, which expects the acquisitions to add to net income immediately, reportedly fended of stiff competition from offshore bidders. According to the AFR, Wright Express' closest rival Fleet or Technologies was also in the running for the asset. Bank of America Merrill Lynch advised Wright Express, with the sale process managed by Morgan Stanley. There's news of another BP asset on the shopping cart, with the cash-strapped oil major reportedly eyeing a prospective buyer for its German fuel station unit Aral. According to German magazine, Wirtschaftswoche, the unit is expected to fetch a price of two billion euro with European industry stalwarts Total, Avia and Rosneft all interested in the asset. Meanwhile, BP's final push to cap the Macondo well may be ready to bear fruit, but the company is still coming to term with the magnitude of the damage suffered by its brand. The UK's Telegraph reports that owners of as many as 11,300 US petrol stations are considering ditching the BP name in favour of the traditional American Amoco brand. The Queensland government's planned float of its bulk coal rail company, QR National, has taken another step forward with CBA and Wilson HTM named as the lead managers of the listing. Ord Minnett and Patersons will act as co-managers to QR National's float. XRF Scientific Limited has signed a binding agreement to acquire the fusion flux and platinum manufacturing businesses from the Sigma Group of companies. The $7 million consideration is in cash and scrip.
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