Yancoal Australia has made a binding offer to acquire Mitsubishi Development’s 32.4% interest in the Hunter Valley Operations Joint Venture (HVO JV) coal projects in New South Wales for US$710 million. Mitsubishi has until June 23 to accept the Tag-along Offer.

The offer fulfills Yancoal’s obligation to make a ‘tag-along offer’ to Mitsubishi under the sale and purchase agreement for Yancoal’s acquisition of Coal & Allied Industries from wholly-owned subsidiaries of Rio Tinto (CNA Transaction) and the corresponding requirements of the HVO JV Agreement.

If Mitsubishi accepts the Tag-along Offer then Yancoal and Mitsubishi will be subject to a binding agreement for Yancoal to acquire Mitsubishi’s 32.4% interest in the HVO JV. This transaction is conditional on completion of the CNA Transaction as well as receipt of necessary regulatory approvals.

Yancoal Australia chief executive officer Reinhold Schmidt said, “The offer is another important milestone in the strategic acquisition of Coal & Allied and sends a clear message to all stakeholders of Yancoal Australia’s continuing investment into the local resources sector.

“We have negotiated a commercially robust offer in the best interests of all parties and the future growth of the Coal & Allied assets.

“With Rio Tinto’s support, we look forward to progressing the next steps in the Coal & Allied Transaction to become Australia’s largest independent coal producer.”

Completion of the Mitsubishi transaction will occur the later of the date which is six months after the date of completion of the CNA Transaction (or an earlier date specified by Yancoal); or 10 business days after fulfilment of the conditions precedent, which includes, among other things, obtaining the necessary regulatory approvals.

www.yancoalaustralia.com.au

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