Hong Kong-listed shares of Yanzhou Coal Mining, China's fourth-largest coal miner, jumped yesterday, buoyed by its acquisition of Gloucester Coal, the mainland's second-biggest Australian takeover deal.
The transaction, which helps Yanzhou secure more coal mines and gain port access in Australia, is the latest sign that Beijing intends to increase outbound investments in keeping with the country's rising economic might.
Yanzhou will merge its Australian assets with Gloucester to create Yancoal Australia, which will be listed on the Australian Securities Exchange.
Shareholders of Gloucester will be paid A$3.20 (HK$25) for each share and get 23 per cent of the combined Yancoal Australia, which values the acquisition at A$2.1 billion. The remaining 77 per cent of Yancoal Australia will be held by Yanzhou.
The takeover, subject to approvals by shareholders and regulators in China and Australia, follows Yanzhou's A$3.1 billion buyout of Felix Resources in 2009, the mainland biggest acquisition in Australia.
'The acquisition paves the way for Yanzhou's aggressive expansion in Australia,' Changjiang Securities analyst Ge Jun said. 'In the short run, the takeover is not expected to bring handsome profits but the consolidation will generate huge profits in the long term if the Australian businesses are well managed.'
Yanzhou's H shares climbed 6.62 per cent to HK$16.74 yesterday and the mainland-listed yuan-denominated A shares rose 1.41 per cent to 21.58 yuan.
