The Chinese approach to Gloucester Coal, 
proposing a merger with Yancoal Australia, is driven by an interesting mix of 
necessity and opportunity. 
In 2009, Yancoal’s parent, the Chinese 
state-owned enterprise Yanzhou Coal Mining, acquired Felix Resources and its 
coal mines in NSW and Queensland for more than $3 billion, the biggest 
acquisition of an Australian company by China at that time.
The problem for Yanzhou is that to obtain 
Foreign Investment Review Board approval it committed to offering 30 per cent of 
Yancoal to public investors before the end of 2012. With the clock ticking and 
market conditions deteriorating the prospect of a forced selldown against a 
deadline and into a potentially difficult market next year will have been the 
focus of significant attention within Yanzhou
Business Spectator. 
 
 
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