Whitehaven Shares Rise to Record in Sydney Trading on Potential Takeovers

-- Whitehaven Coal Ltd., a coal producer with a market value of A$3 billion ($2.75 billion), rose to a record in Sydney trading after the company said it’s in talks with unidentified groups about potential deals.

Whitehaven gained 5.9 percent to A$6.07 at the 4:10 p.m. local time close on the Australian stock exchange, the highest since they began trading in June, 2007. The talks “are continuing, are preliminary and remain incomplete,” the Sydney- based company said today in a statement.

China Shenhua Energy Co. and Coal India Ltd. are among companies that may have made an approach, the Australian Financial Review said today. Foreign companies are targeting coal producers in Australia, the world’s biggest exporter of the fuel, as prices are expected to gain until 2012, according to forecasts from Deutsche Bank AG.

“We have seen in recent times there’s a lot of foreign energy groups keen to secure coal supply from important and strategic assets in Australia,” Jamie Spiteri, head dealer at Shaw Stockbroking Ltd. in Sydney, said by phone. There’s a takeover premium priced into Whitehaven’s shares, he said.

Korea’s Posco, which was also named by the newspaper as a possible suitor, hasn’t approached Whitehaven, spokesman Choi Doo Jin said. Whitehaven Chief Executive Officer Tony Haggarty wasn’t able to be reached at his office or on his mobile phone.

Coal India hasn’t bid for Australia’s Whitehaven, Partha Bhattacharyya, chairman of the Indian company, said in a phone interview today. “Coal India has not bid for this property in Australia,” he said from Kolkata, where the company is based.

Wang Jinli, vice president of Beijing-based Shenhua Energy, said he isn’t aware of the talks as reported by the newspaper.

‘Potential Transactions’

“Whitehaven has had, and continues to have, discussions with third parties in relation to potential corporate transactions,” the company said in the statement. “It is highly uncertain whether they will lead to a proposal for consideration by the company’s directors and shareholders.”

Banpu Pcl, Thailand’s biggest coal producer, agreed last month to buy the rest of Centennial Coal Co. for A$2 billion. Last year, Yanzhou Coal Mining Co. won Australian government approval for a A$3.5 billion takeover of Felix Resources Ltd.

Expanding output at the Narrabri mine in Australia’s New South Wales state may make the company a takeover target, Haggarty said in a June interview. “If that makes us attractive to somebody and they want to come along and make an offer, the board and the shareholders are always open to offers,” he said.

Whitehaven last month reported fourth-quarter coal sales were little changed amid higher prices for power-station coal. Total sales were 1.041 million metric tons in the three months ended June 30, up from 1.038 million tons a year earlier.

-- With assistance by Sungwoo Park in Seoul, Madelene Pearson in Mumbai and Winnie Zhu in Shanghai. Editors: Keith Gosman, Andrew Hobbs

To contact the reporter on this story: Rebecca Keenan in Melbourne at rkeenan5@bloomberg.net

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