Rocklands Richfield Ends Talks on Jindal Takeover WSJMELBOURNE...

Rocklands Richfield Ends Talks on Jindal Takeover WSJ

MELBOURNE -- Tightly held Australian coal miner Rocklands Richfield Ltd. said Wednesday it ended talks with Jindal Steel & Power Ltd. over the Indian group's proposed takeover after deciding the deal wasn't in the best interests of shareholders.

Rocklands Chairman Benny Wu, who owns 70.2% of the company, has spurned the Indian bid despite the significant premium on offer, pointing to the improving global demand outlook for metallurgical coal, a key steelmaking input.

The rebuff for Jindal may open the way for rival bidder Meijin Energy Group to make a fresh play for the miner, but it would likely have to improve on its previous offer to win over Mr. Wu.

Jindal last month exercised its right to match an offer of 56 Australian cents a share from China's Meijin for the coking coal developer, valuing Rocklands at 197 million Australian dollars ($174 million).

"RCI has invested substantial senior management time and other resources in its extensive discussions with Jindal but, based on the latest Jindal proposal, the board no longer considers that it is in the best interests of RCI shareholders for RCI to continue these discussions," Mr. Wu said in a statement.

Rocklands said it is confident in its growth prospects given the improving global outlook for metallurgical coal and that its directors are now considering future strategic opportunities for RCI under its current ownership structure.

Jindal Finance Director Sushil Maroo said it was up to Rocklands whether it wanted to go ahead with the deal, but added that Jindal had done what was expected of a company in a bidding process and had matched Meijin's rival bid.

Mr. Maroo said the failure to acquire Rocklands would have no impact on Jindal's access to raw materials as the target's coking coal resources wouldn't be in production for years and that Jindal remains on the lookout for coking coal assets globally.

"Just because we were talking to Rocklands doesn't mean we stopped tracking other opportunities," he told Dow Jones Newswires.

Rocklands Company Secretary Nancy Liang said the company hadn't been contacted by Meijin since it upped its offer to 56 cents from 52 cents in December.

Rocklands has coal tenements in Queensland state that it estimates hold more than 900 million tons of coal and also operates a coking plant in eastern China.

Write to Alex Wilson at [email protected]

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I note this paragraph:

'Rocklands Company Secretary Nancy Liang said the company hadn't been contacted by Meijin since it upped its offer to 56 cents from 52 cents in December.'

Nice to inform the market on this development.