BREAKFAST DEALS: Palmer's hidden hand

Mining magnate and Australia's fifth richest man Clive Palmer labels talks of an imminent listing in Hong Kong a "press beat up” but refuses to reject the claims outright. Meanwhile, New Hope's revised bid for Northern Energy gets binned, some heavyweight suitors may be out of the race for Whitehaven and we take a peek at Woodside's wishlist for a new CEO. Elsewhere, Lynas boss says he is committed as ever to the company; Quickstep Holdings soars after a major Joint Strike Fighter deal and more trouble in Russia for BP.  

Clive Palmer, Resourcehouse

Mining magnate Clive Palmer has poured cold water on any imminent moves to list his coal company Resourcehouse in the Hong Kong Exchange, but Australia's fifth-richest man is keeping the cards pretty close to his chest. Palmer has refused to confirm or deny reports that Resourcehouse was set to press the button on a $3 billion-plus listing after the Chinese Lunar New Year. He did tell Reuters that no announcements have been made with regards to any listing and the speculation was a "press beat up”, but that doesn't necessarily mean that it's completely out of the picture. There has been talk that Palmer shelved the listing in November last year after excessive press coverage of the move breached Hong Kong rules for floats, so it's understandable why he might want to keep a low profile this time and let Resourcehouse's annual report for 2010 do the talking. The report has highlighted two heavyweight coal supply contracts, one with Swiss trader Vitol and another with China Power Holdings. Resourcehouse has put a combined value of $82 million on the China Power and Vitol deals. The report has also shed light on the company's high-profile board which boasts the presence of former foreign affairs minister Alexander Downer, Suntech Power chief executive Zhengrong Shi and Metallurgical Corp of China president Heting Shen. The Hong Kong exchange is attracting a lot of big names of late with Swiss trading house Glencore and major copper miner Kazakhmys both looking to follow the footsteps of Russian aluminium giant Rusal, which took the plunge last year. Resourcehouse might not be in the same league as those miners but with solid coal contracts in hand and a heavyweight board a listing could still be a possibility.  

Woodside Petroleum, Origin Energy, Shell Australia

Woodside Petroleum, one of BHP Billiton's purported takeover targets in the oil and gas sector, is reportedly looking for a big name to replace outgoing boss Don Voelte. According to Fairfax papers, Origin Energy boss Grant King heads Woodside's wishlist with Shell Australia chairman Ann Pickard and another foreign candidate also in the mix. BG Group's chairman Catherine Tanna was also seen as a likely candidate but the paper said that she has opted to stay put for now. The short list prepared by headhunters Heidrick & Struggles also reportedly contains an internal candidate. Voelte decided to hang up his boots after a seven year stint in October last year and both the executive vice president of Woodside's North West Shelf business, Kevin Gallagher, and the executive vice president of the Pluto project, Lucio Della Martina, have been touted as possible home grown successors to carry the torch after Voelte's departure in the first half of this year.  

New Hope Coal, Northern Energy, Whitehaven Coal

Now to other news in the coal sector, veteran investor Robert Millner's New Hope Coal is facing the grim prospect of either further sweetening its $225 million offer for target Northern Energy (NEC) or calling it quits. As expected, NEC has dismissed New Hope's revised offer, labelling it as ill-informed and undervaluing the company's growth potential. NEC plans to start production at its Maryborough coking coal project in 2012 and its Elimatta thermal coal mine in 2014. Both projects need significant capital and Millner's pitch to NEC shareholders has been that New Hope has the necessary capital to develop the assets as quickly as possible. Unfortunately that message is getting a short shrift from NEC's board and shareholders. The $1.75 bid is still well short of the mid-point of an independent expert's valuation range, from $2.70 to $3.99 per share, and the ball now is firmly in New Hope and Millner's court. Meanwhile, Whitehaven Coal is getting ready to front non-binding offers from interested parties this week and it looks like a number of heavyweight suitors have dropped out of the race. According to Reuters, China's Yanzhou Coal Mining and US-based Cliffs Natural Resources are no longer in the process. The news comes after another prospective US suitor Alpha Natural Resources was ruled out after its $US7.1 billion acquisition of Massey Energy. The most likely Chinese bidder at the moment is Shenhua Group and expect a healthy interest from Korean and Indian companies.

Lynas Corporation, Paladin Energy, Fronteer Gold

Rare earth miner Lynas Energy's shares took a tumble on news that its executive chairman Nicholas Curtis has sold the majority of his stake in the company. Lynas shares dropped 8 per cent after Lynas revealed that Curtis had sold 7,000,000 shares for $13.5 million on-market in the last week of January. His direct holding now stands at 1.1 million shares. Curtis has moved to allay any investor fears by telling the media that the move had more to do with diversifying his personal assets and financial planning rather that any wavering of his commitment to the company. Meanwhile, uranium explorer Paladin Energy has completed the acquisition of the uranium assets of Aurora Energy Resources from Canada's Fronteer Gold. Paladin has picked up Fronteer's uranium assets in Eastern Canada in a $261 scrip deal. Under the terms of the completed Agreement, Fronteer will receive 52.1 million common shares of Paladin becoming its largest shareholder with a 6.7 per cent stake. There is some talk that Fronteer may not be a long-term holder of the stake, with Merril analysts saying that the Canadian company may offload the stake to an interested party to funds its projects in the US. Elsewhere, recently listed mining minnow Fortis Mining has entered into a strategic partnership alliance with Hong Kong-based investment company Grand Concord Investments Ltd to gain access to global mining opportunities. Fortis has secured the partnership through the placement of six million shares at 40 cents a piece. Melbourne-based Fortis came to the market in November last year as a metals explorer but the company said it was currently in pursuit of a potash asset, with the help of Grand Concord. Altona Mining has raised $42.6 million from institutional investors after its share placement closed oversubscribed. Credit Suisse was the lead manager and underwriter to the issue, with Bell Potter, Foster Stockbroking and Pareto Securities acting as co-lead managers. Strike Resources is set to announce a management restructure. Strike is currently run by former Polaris Metals chief Ken Hellsten after former managing director Shanker Madan moved to take up the non-executive chairman position in March last year.

Wrapping up

Aerospace and defence play Quickstep Holdings has received a boost after the company announced that it has signed a long term agreement (LTA) with Northrop Grumman Corporation to manufacture parts for the international F-35 Joint Strike Fighter (JSF) program over the next 20 years. Under the framework established in the LTA, first JSF parts and first cash flow will be delivered in 2012. Quickstep will supply up to 16 different JSF components, including lower side skins, maintenance access panels, fuel tank covers, lower skins and in-board weapons bay doors, projected to amount to some 36,000 parts over the life of the program which could generate annual turnover of around $50 million by 2015. The total value of the work over the life of the aircraft could be up to $700 million. In international news, BP's multi-billion dollar Arctic exploration pact with Rosneft has run into rough weather with the UK oil major's Russian partner in the TNK-BP joint venture winning a decision in the UK courts to put the brakes on the deal. BP's partner AAR has alleged that the oil major's deal with Rosneft breached a previous BP commitment to seek AAR approval before entering into any major new Russian venture. Under the ruling handed down by a London court BP has until February 25 to reach an amicable solution with AAR. Unfortunately for BP, Rosneft is not making things easy after the state-controlled energy giant said that it will not allow TNK-BP to be part of the £10 billion deal with BP. The UK oil major is also in some hot water in the US with regulators reportedly investigating the company over alleged manipulation of the gas market in 2008. In the local energy space, Molopo Energy has sold its Spearfish oil asset in southwest Manitoba to Canada's Legacy Oil and Gas for $188 million dollars but the move has only given Molopo's rebel shareholders – led by property developer Max Beck – more ammunition for their fight against Molopo's board. The group of dissidenting shareholders, including billionaires Bruce Mathieson and Boris Lieberman, is seeking the removal of the company's chairman Donald Beard and non-executive director Bruce Hobnay. While the Spearfish deal does aid Molopo's balance sheet the disgruntled shareholders have said that the sale of a core asset further highlighted the rot in Molopo's management.  Molopo shareholders will vote on February 15 on the group's proposal to replace Beard with former Shell man Greg Lewin and Beck taking Hobnay's position. In other local news, paper merchant PaperlinX has relocated its chief executive officer and chief financial officer to its operational headquarters in the UK and closed its office in Amsterdam to cut costs. Paperlinx said that the move, along with recent staff reductions in its Melbourne corporate head office, will save around $15 million a year. Redcape Property Group has exchanged contracts to sell the Port Macquarie/Town Green Inn Hotel at Port Macquarie New South Wales for $15.8 million and the Ocean Shores Tavern at Ocean Shores in northern NSW for $4.6 million. Both were sold at or above June 2010 book value.