Macarthur Coal gets takeover approach

SYDNEY (Reuters) - Australia's Macarthur Coal Ltd MCC.AX, 20 percent-owned by the Chinese government, said on Monday it had been approached by a potential buyer, raising its shares 17 percent to a record.

Macarthur Coal, which has a market capitalization of about A$3.2 billion ($3.0 billion) said, however, no offer had been made for the company and that talks with the so-far unnamed group were incomplete.

China's state-owned Citic Group owns 19.99 percent of Macarthur Coal, while local media said the company's founder Ken Talbot had held talks with Swiss-based Xstrata (XTA.L) and others over his 24 percent stake in Macarthur.

Officials from Citic and Xstrata were not immediately available to comment.

Australia's coal miners, benefiting from sky-high coal prices this year, have been vying to control larger portions of the Australian export market, while China has been placing an ever-increasing footprint on the local sector.

"Companies such as BHP Billiton (BHP.AX), Rio (RIO.AX) and Xstrata (XTA.L) are set to gain massively, and along with the Chinese are only looking to increase their operations," DJ Carmichael & Co analyst James Wilson said.

Macarthur's suitor had already approached the company's major shareholders, the company said in a statement.

Macarthur shares zoomed as much as 17.4 percent to a record A$15.5 before easing to around A$15.1. Macarthur shares have risen 52 percent this year, compared with a 12 percent decline in S&P/ASX 200 .AXJO index.

Last month Xstrata paid A$1.09 billion for another Australian coal miner, Resource Pacific, and has spent billions more buying other outback miners.

China Coal Energy (1898.HK) (601898.SS), China's No. 2 coal miner, this month said it too was looking for investments in Australia.

COMPANY FOUNDER

Macarthur's founder Talbot, who holds 51 million shares in Macarthur worth about A$770 million at the current market price, has been selling down his stake.

Citic increased its holding to 19.99 percent after paying A$113 million to Talbot for an extra 8.37 percent last year.

The Australian Financial Review said on Monday in an unsourced report that Talbot had held talks with Xstrata and others about selling his stake.

Under Australian takeover laws, a company acquiring more than 20 percent of a public company is required to launch a full takeover for the rest of the company.

Talbot, an Australian mining magnate, is facing 35 charges related to an allegedly illegal $300,000 loan to Gordon Nuttall, a former Australian state government minister.

Both men have denied any wrong doing. A hearing into the matter has adjourned and will conclude in May.

Demand for coal from Australia, the world's biggest exporter, has outstripped supply this year, driving coal prices up as much as 300 percent to the highest ever.

"Any coal miner that wants to sell today, there will certainly be interested parties," Macarthur's chairman, Keith De Lacy told Australian Broadcasting Corp Radio.

"If you are going to sell an interest in a coal company, you would never get a better time than now," he said.

Citic was formed by Beijing to help China garner raw materials from outside its borders to help fuel the country's massive industrialization.

Macarthur, which mostly mines coal for steel making in Queensland state's Bowen Basin, has appointed JP Morgan as its financial adviser.

($1=A$1.07)