BREAKFAST DEALS: Palmer launch
Clive Palmer's Resourcehouse IPO finally has momentum, while rumours of a King return to Leighton persist.
After three false starts Clive Palmer's $3 billion float of Resourcehouse gets ready for its official launch, with two heavyweight Chinese cornerstone investors ready to take their share of the miner. And Fairfax may be looking to get the ball rolling on the sale of its radio assets with KPMG charged with conducting a strategic review of the broadcast business. Meanwhile, a stronger Australian dollar may have hurt the Whitehaven sale process, but did the miner's board get a little too greedy? Elsewhere, the first meeting between Leighton Holdings and its major shareholder Spain's Grupo ACS turns out to be a tame affair, Kerry Packer gets closer to getting his piece of the online retail pie and Qantas is mulling options to resuscitate its international business.
Clive Palmer, Resourcehouse
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It's a case of fourth time lucky for mining magnate Clive Palmer and his attempts to float Resourcehouse in the Hong Kong market. Resourcehouse's third attempt at a listing was scuttled in March when shaky markets forced the miner to postpone its IPO roadshow. However it looks like all systems are go this time around with the listing due by early June. The formal process is reportedly set to start today with Resourcehouse hoping to raise up to $US3.6 billion through the sale of 5.72 billion shares at $HK4.48-$4.93 per share. Palmer reportedly introduced Resourcehouse's two cornerstone investors – Metallurgical Corporation of China and China Railway Group – yesterday, and Hong Kong's The Standard newspaper reports that each has agreed to subscribe for $US200 million worth of shares, with a lock-up period of 12 and six months, respectively. According to Reuters, there is also a greenshoe option which could take the offering above the $4 billion mark. The money is destined to fund the development of Resourcehouse's China First Coal Project in central Queensland and the China First iron ore project in Western Australia. Palmer is expected to keep half of the company and will be on the board but The Australian reports that the chairman position will be filled by former Deloitte boss Dominic Martino. The rest of the board includes the likes of former foreign minister Alexander Downer, Clive Mensink, the chief executive of Palmer's soccer team Gold Coast United and Palmer's nephew and long-time employee Derek Payne. There are reportedly two Chinese representatives, solar firm Suntech's billionaire boss Shi Zhenrong and veteran metallurgist Bai Baohua. So after three false starts Palmer's coal and iron play is finally expected to take its first steps today and list on the Hong Kong Exchange in early June. BOC International, HSBC, RBS and UBS are working as the joint global co-ordinators and joint bookrunners for the IPO.
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Fairfax Media
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Talks of asset sales at Fairfax Media have been doing the rounds ever since the ascension of Greg Hywood as the CEO in February. While much of the latest attention has fallen on the possible sale of Fairfax's stake in New Zealand auction website Trade Me it looks like there is some behind the scenes action with regards to the fate of its broadcasting division. According to The Australian, Fairfax has hired corporate adviser KPMG to conduct a strategic review of the business, which is behind successful radio stations like Melbourne's 3AW and Sydney's 2UE, and could be worth up to $260 million. Now analysts have been harping on about a potential sale of the radio assets to unlock value for some time now and the internal review carried out by KPMG could be the precursor to such a move given that it will allow Hywood to get an idea of the price he is willing to start negotiations on. Fairfax is reportedly expected to make a formal statement on the issue this morning and John Singleton's Macquarie Radio Network will no doubt be listening closely to what Hywood has to say.
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Whitehaven Coal, Gold One International, Gloucester
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Back to the action in the mining sector, Whitehaven Coal's shares took a hit yesterday after the miner failed to find a suitable suitor after a seven month sales process which makes one wonder about how the wheels fell off on this one, was it the high Australian dollar or was the miner just asking for too much? China's Yanzhou looked to be in the box seat earlier this month with talks that it had prepared a $3.5 billion bid for Whitehaven before it told China Daily on April 21st that it wasn't interested after an initial assessment, while its closest rival India's Aditya Birla Group was reportedly lining up funds for their offer. The sales process was started by Whitehaven last October after the miner received several approaches but at the end there was nothing worth talking about on the table with an expected bidding war never seeing the light of day. Whitehaven boss Tony Haggarty has told the media that the soaring strength of the Australian dollar may have had an adverse impact on the auction but there are some who say that Whitehaven's board may have gotten a bit greedy and that might have forced the suitors to back down. If there were currency issues at play then Yanzhou and few other suitors could well come back at a later time but for now Whitehaven will just have to go it alone. Meanwhile, Gloucester Coal has paid $360 million in a scrip deal to buy Donaldson Coal from its majority shareholder Noble Group . The miner plans to raise $230 million in an underwritten share issue to help fund the deal.
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Finally, Sydney-based South African gold miner Gold One International may now reportedly be looking to list in Hong Kong, after accepting a takeover offer from a Chinese consortium. The offer values Gold One at around $600 million and Gold One's chairman Mark Wheatley has told the AFR that the miner will now actively consider expansion plans which includes a listing in Asia. The offer from the consortium led by Baiyin Non-Ferrous Group comes less than a month after it purchased an 18 per cent stake in Gold One.
Leighton Holdings
The first meeting between Leighton Holdings and its brand new majority shareholder Spain's Grupo ACS has been a remarkably tame affair, with Leighton's boss David Stewart and CFO Peter Gregg reportedly having a cordial chat with ACS' corporate general manager Angel Garca Altozano. But could it be calm before the storm for Stewart and Leighton chairman David Mortimer? Rumours of an imminent return of Wal King back to the Leighton fold continue unabated and the real question now seems to be around the time and just how big a role he is going to take. While some say that the return of King, possibly as a non-executive director, may take a fair bit of time. However, there are just as many forecasting a swift return of King at the behest of ACS, and given the instability that the move will cause within Leighton's board such a move could prove the end of Mortimer's tenure at Leighton and make a decidedly tense situation for Stewart. A lot of this is obviously pure speculation, given that King has steered clear of commenting on the issue and the final and nature of King's return is firmly in the hands of ACS.
James Packer, Scoopon, Foxtel, Austar
James Packer's online retail ambitions have reportedly taken a step closer to fruition with an announcement on the purchase of a significant stake in the group buying website Scoopon and Catch of the Day expected as early as next week. According to the AFR, details of the final deal are still being finalised and it's still unclear if Packer is making the buy through his investment vehicle Ellerston Capital or Consolidated Media Holdings. Staying with the media sector, there's more speculation on the mooted $2 billion pay TV deal between Foxtel and Austar, despite the fact that a formal proposal is yet to hit the table. The latest bout of talk has reportedly been started after Austar's chief executive John Porter was seen walking out of a building at the same time as bankers from UBS. That may seem like a case of wishful thinking from some but maybe the wheels are in motion albeit very, very slowly. Meanwhile, online comparison group iSelect is set to acquire Infochoice, BidMyLoan and Once Life in a deal worth $33.5 million, as it seeks to expand into the competitive financial services comparison market. The deal is at a 70 per cent premium to the Infochoice market price, with the company valued at $19.2 million and subject to due diligence. Infochoice is 98.4 per cent controlled by Singapore based property developer YanLord.
Wrapping up
Qantas boss Alan Joyce is keeping all his options open when it comes to breathing some new life into the airline's international business. This resuscitation will no doubt involve a move in Asia and with Singapore and Malaysia both spruiked as possible destinations for the airline to start a brand new airline, Joyce has so far kept his cards close to his chest. Speaking at the launch of the airline's inaugural flight to Dallas/Fort Worth, Texas, Joyce said there is no one single panacea to the problems plaguing Qantas so a brand new Asia-focused premium airline could one of the many solutions in the mix. Meanwhile, Tully Sugar's Chinese suitor COFCO seems to be making all the right move to get its hands on the target. According to the AFR, COFCO has agreed to maintain Queensland Sugar Limited as marketer for Tully, giving it crucial leverage as Tully's shareholders get set to vote on lifting a ban that prevents any one shareholder from owning more than 20 per cent of the company. Retail Food Group has terminated its $95 million bid for Oaks Hotels & Resorts, after Thailand's Minor International managed to win exemption from the Australian Securities and Investments Commission to acquire 34.4 per cent of Oaks shares from the receivers and managers for Centrepoint Holdings and Oaks Apartment Management. According to RFG, the exemption was a defeating condition to its takeover offer. Finally in overseas news, Nasdaq OMX and its joint partner Intercontinental Exchange have withdrawn their $US11 billion hostile takeover proposal for NYSE Euronext overnight after being told by US regulators that there was no way the deal was going to get across the line. Unfortunately for Nasdaq it had little or no wiggle room available given the monopoly concerns the bid had generated. So it's back to the drawing board for Nasdaq and ICE, both of which will now have to cast a wider net for acquisitions in a rapidly consolidating sector.
Clive Palmer, Resourcehouse
.
It's a case of fourth time lucky for mining magnate Clive Palmer and his attempts to float Resourcehouse in the Hong Kong market. Resourcehouse's third attempt at a listing was scuttled in March when shaky markets forced the miner to postpone its IPO roadshow. However it looks like all systems are go this time around with the listing due by early June. The formal process is reportedly set to start today with Resourcehouse hoping to raise up to $US3.6 billion through the sale of 5.72 billion shares at $HK4.48-$4.93 per share. Palmer reportedly introduced Resourcehouse's two cornerstone investors – Metallurgical Corporation of China and China Railway Group – yesterday, and Hong Kong's The Standard newspaper reports that each has agreed to subscribe for $US200 million worth of shares, with a lock-up period of 12 and six months, respectively. According to Reuters, there is also a greenshoe option which could take the offering above the $4 billion mark. The money is destined to fund the development of Resourcehouse's China First Coal Project in central Queensland and the China First iron ore project in Western Australia. Palmer is expected to keep half of the company and will be on the board but The Australian reports that the chairman position will be filled by former Deloitte boss Dominic Martino. The rest of the board includes the likes of former foreign minister Alexander Downer, Clive Mensink, the chief executive of Palmer's soccer team Gold Coast United and Palmer's nephew and long-time employee Derek Payne. There are reportedly two Chinese representatives, solar firm Suntech's billionaire boss Shi Zhenrong and veteran metallurgist Bai Baohua. So after three false starts Palmer's coal and iron play is finally expected to take its first steps today and list on the Hong Kong Exchange in early June. BOC International, HSBC, RBS and UBS are working as the joint global co-ordinators and joint bookrunners for the IPO.
.
Fairfax Media
.
Talks of asset sales at Fairfax Media have been doing the rounds ever since the ascension of Greg Hywood as the CEO in February. While much of the latest attention has fallen on the possible sale of Fairfax's stake in New Zealand auction website Trade Me it looks like there is some behind the scenes action with regards to the fate of its broadcasting division. According to The Australian, Fairfax has hired corporate adviser KPMG to conduct a strategic review of the business, which is behind successful radio stations like Melbourne's 3AW and Sydney's 2UE, and could be worth up to $260 million. Now analysts have been harping on about a potential sale of the radio assets to unlock value for some time now and the internal review carried out by KPMG could be the precursor to such a move given that it will allow Hywood to get an idea of the price he is willing to start negotiations on. Fairfax is reportedly expected to make a formal statement on the issue this morning and John Singleton's Macquarie Radio Network will no doubt be listening closely to what Hywood has to say.
.
Whitehaven Coal, Gold One International, Gloucester
.
Back to the action in the mining sector, Whitehaven Coal's shares took a hit yesterday after the miner failed to find a suitable suitor after a seven month sales process which makes one wonder about how the wheels fell off on this one, was it the high Australian dollar or was the miner just asking for too much? China's Yanzhou looked to be in the box seat earlier this month with talks that it had prepared a $3.5 billion bid for Whitehaven before it told China Daily on April 21st that it wasn't interested after an initial assessment, while its closest rival India's Aditya Birla Group was reportedly lining up funds for their offer. The sales process was started by Whitehaven last October after the miner received several approaches but at the end there was nothing worth talking about on the table with an expected bidding war never seeing the light of day. Whitehaven boss Tony Haggarty has told the media that the soaring strength of the Australian dollar may have had an adverse impact on the auction but there are some who say that Whitehaven's board may have gotten a bit greedy and that might have forced the suitors to back down. If there were currency issues at play then Yanzhou and few other suitors could well come back at a later time but for now Whitehaven will just have to go it alone. Meanwhile, Gloucester Coal has paid $360 million in a scrip deal to buy Donaldson Coal from its majority shareholder Noble Group . The miner plans to raise $230 million in an underwritten share issue to help fund the deal.
.
Finally, Sydney-based South African gold miner Gold One International may now reportedly be looking to list in Hong Kong, after accepting a takeover offer from a Chinese consortium. The offer values Gold One at around $600 million and Gold One's chairman Mark Wheatley has told the AFR that the miner will now actively consider expansion plans which includes a listing in Asia. The offer from the consortium led by Baiyin Non-Ferrous Group comes less than a month after it purchased an 18 per cent stake in Gold One.
Leighton Holdings
The first meeting between Leighton Holdings and its brand new majority shareholder Spain's Grupo ACS has been a remarkably tame affair, with Leighton's boss David Stewart and CFO Peter Gregg reportedly having a cordial chat with ACS' corporate general manager Angel Garca Altozano. But could it be calm before the storm for Stewart and Leighton chairman David Mortimer? Rumours of an imminent return of Wal King back to the Leighton fold continue unabated and the real question now seems to be around the time and just how big a role he is going to take. While some say that the return of King, possibly as a non-executive director, may take a fair bit of time. However, there are just as many forecasting a swift return of King at the behest of ACS, and given the instability that the move will cause within Leighton's board such a move could prove the end of Mortimer's tenure at Leighton and make a decidedly tense situation for Stewart. A lot of this is obviously pure speculation, given that King has steered clear of commenting on the issue and the final and nature of King's return is firmly in the hands of ACS.
James Packer, Scoopon, Foxtel, Austar
James Packer's online retail ambitions have reportedly taken a step closer to fruition with an announcement on the purchase of a significant stake in the group buying website Scoopon and Catch of the Day expected as early as next week. According to the AFR, details of the final deal are still being finalised and it's still unclear if Packer is making the buy through his investment vehicle Ellerston Capital or Consolidated Media Holdings. Staying with the media sector, there's more speculation on the mooted $2 billion pay TV deal between Foxtel and Austar, despite the fact that a formal proposal is yet to hit the table. The latest bout of talk has reportedly been started after Austar's chief executive John Porter was seen walking out of a building at the same time as bankers from UBS. That may seem like a case of wishful thinking from some but maybe the wheels are in motion albeit very, very slowly. Meanwhile, online comparison group iSelect is set to acquire Infochoice, BidMyLoan and Once Life in a deal worth $33.5 million, as it seeks to expand into the competitive financial services comparison market. The deal is at a 70 per cent premium to the Infochoice market price, with the company valued at $19.2 million and subject to due diligence. Infochoice is 98.4 per cent controlled by Singapore based property developer YanLord.
Wrapping up
Qantas boss Alan Joyce is keeping all his options open when it comes to breathing some new life into the airline's international business. This resuscitation will no doubt involve a move in Asia and with Singapore and Malaysia both spruiked as possible destinations for the airline to start a brand new airline, Joyce has so far kept his cards close to his chest. Speaking at the launch of the airline's inaugural flight to Dallas/Fort Worth, Texas, Joyce said there is no one single panacea to the problems plaguing Qantas so a brand new Asia-focused premium airline could one of the many solutions in the mix. Meanwhile, Tully Sugar's Chinese suitor COFCO seems to be making all the right move to get its hands on the target. According to the AFR, COFCO has agreed to maintain Queensland Sugar Limited as marketer for Tully, giving it crucial leverage as Tully's shareholders get set to vote on lifting a ban that prevents any one shareholder from owning more than 20 per cent of the company. Retail Food Group has terminated its $95 million bid for Oaks Hotels & Resorts, after Thailand's Minor International managed to win exemption from the Australian Securities and Investments Commission to acquire 34.4 per cent of Oaks shares from the receivers and managers for Centrepoint Holdings and Oaks Apartment Management. According to RFG, the exemption was a defeating condition to its takeover offer. Finally in overseas news, Nasdaq OMX and its joint partner Intercontinental Exchange have withdrawn their $US11 billion hostile takeover proposal for NYSE Euronext overnight after being told by US regulators that there was no way the deal was going to get across the line. Unfortunately for Nasdaq it had little or no wiggle room available given the monopoly concerns the bid had generated. So it's back to the drawing board for Nasdaq and ICE, both of which will now have to cast a wider net for acquisitions in a rapidly consolidating sector.
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