INTERVIEW: New Hope Open To Takeover Offers At Right Price

Australian coal miner New Hope Corp. Ltd. (NHC.AU) would be open to takeover offers if suitors came up with worthwhile bids, although only informal "tire kickers" have made approaches so far, Managing Director Robert Neale said Tuesday.

New Hope will be the largest-listed Australian coal producer by both output and market capitalization if Rio Tinto PLC (RIO) and Mitsubishi Corp. (8058.TO) succeed in buying out minority shareholders in Coal & Allied Industries Ltd. (CNA.AU), a deal which values the target at 10.8 billion Australian dollars (US$11 billion).

The concurrent joint bid by Peabody Energy Corp. (BTU) and ArcelorMittal (MT) for Macarthur Coal Ltd. (MCC.AU), valuing Macarthur at A$4.83 billion, would leave just a handful of pure-play coal miners left on the Australian market, even though the country is the world's largest coal exporter by volume.

"There aren't too many green bottles left standing on the wall," Neale said in an interview with Dow Jones Newswires Tuesday.

"My business is to maximize the value of what we've got at any one time, and our whole strategy has been if someone else is prepared to offer more than the value that we can extract, we will sell," he said.

The 59.7% shareholding owned by investment group Washington H. Soul Pattinson & Co. (SOL.AU) could be viewed by potential suitors as a block to any hostile takeover offer, or an opportunity to secure majority control quickly. Notably, New Hope and Soul Pattinson share the same chairman in Rob Millner.

"Rob (Millner) always says that at the right price everything's for sale, and he's actually dead right," Neale said. "If we get a good price then we've done the right thing by the shareholders."

New Hope has a market capitalization of A$4.23 billion, although its A$1.67 billion in cash and term deposits would significantly lower the company's effective cost to a potential buyer.

The Brisbane-based company has a track record of trading assets for the benefit of investors. In mid-2008, New Hope sold its Saraji coking coal mine in Queensland state to the BMA joint venture of BHP Billiton Ltd. (BHP) and Mitsubishi Corp. for US$2.4 billion.

In annual results Tuesday, the company said net profits more than doubled to A$503.1 million in the year to July 31, largely owing to A$369.8 million earned from selling its stakes in Arrow Energy Ltd. and the Lenton coking coal project.

 
   -By David Fickling, Dow Jones Newswires; [phone]; [e-mail]