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Takeovers Panel Declines To Conduct Proceedings On Peabody Application - Update

Friday, Australia's Takeovers Panel has declined to conduct proceedings and also decided not to make an interim order postponing the shareholders' meeting of Australian miner Macarthur Coal Ltd. (MACDF.PK, MCC.ASX) scheduled on Monday. The developments were in response to an application received from U.S. based coal company Peabody Energy Corp. (BTU) in relation to Macarthur's takeover bid for Australian coal producer Gloucester Coal Ltd (GCL.ASX).

Macarthur has made a takeover bid for all the shares in Gloucester Coal and also has proposed to acquire assets from Gloucester's major shareholder, Noble Group Limited. Noble, in consideration for the assets, will acquire scrip of Macarthur's expanded share capital.

Macarthur has convened a shareholders' meeting on April 12, to approve the proposed issue of shares to Noble Group.

On March 31, Peabody offered to acquire Macarthur at $13 per share. Macarthur reportedly rejected the bid as inadequate. On April 6, Peabody boosted the offer to $14 per share by scheme of arrangement. The initial and revised Peabody proposals are conditional, among other things, on the Gloucester/Noble transactions not proceeding.

On April 7, Macarthur announced that its board had rejected the revised Peabody proposal and that the board continues to recommend that shareholders vote in favor of the resolution at the shareholders' meeting and had determined not to defer that meeting.

Peabody Energy in its application dated April 7 to the panel said Macarthur Coal failed to provide shareholders with information about Peabody's revised bid and asked the Panel to order a postponement of the meeting of Macarthur shareholders to consider Macarthur's own bid to take over Gloucester Coal.

Meanwhile, on Thursday, Australian coal producer New Hope Corp. Ltd. (NHPEF.PK, NHC.ASX) made an all stock proposal to acquire Macarthur Coal, saying it is superior to the all cash offer from Peabody Energy. New Hope has offered 2.7 of its shares for every each Macarthur share by way of a scheme of arrangement valuing Macarthur at A$14.58 per share or A$3.71 billion.

The Takeovers Panel, in a statement, said it will publish its reasons for the decision in due course. The sitting Panel for the proceedings was Hamish Douglass, Paula Dwyer and David Friedlander.

BTU closed Thursday's regular trading session at $46.12 and MACDF.PK at $13.15. NHPEF.PK traded last on March 25 at $4.45.

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