Whitehaven’s standoff ups ante for hostile strategy

Nathan Tinkler is trying to put Whitehaven Coal “in play” by asking the $3 billion miner’s board to lift a standstill agreement preventing him from making a hostile bid or lobbying shareholders to have directors removed, according to the Australian Financial Review.

Tinkler reiterated a series of demands on Friday to Whitehaven chairman Mark Vaile, including the provision of more financial detail and the lifting of the six-month standstill agreement.

The demand came after Whitehaven’s update to the market, in effect a downgrade, failed to address all of Tinkler’s questions.

Predators likely to circle as junior miners struggle for funds

The potential for a spike in corporate activity among junior miners has been highlighted by a new survey that shows two out of three companies in the sector operate with less than $5 million in the bank and are worried about raising capital, according to the Australian Financial Review.

Grant Thornton’s third annual JUMEX survey, which focuses on mining and exploration companies with a market capitalisation of less than $500 million, finds that the availability of equity funding is the biggest issue for respondents.

The survey shows that 35% of companies in the sector hold less than $2 million in cash, while a further 29% hold $2 million to $5 million. These companies are likely to need a capital injection within 12 months, but cannot be certain of investor demand because of global economic volatility.

Push for crackdown on power costs

A new coalition of business and welfare groups wants tough measures to tackle rising power prices, warning that coal and gas costs will overtake network investment as the main driver of price rises, according to the Australian Financial Review.

Cracking down on over-investment in networks – the main factor behind a 50%-plus jump in retail power prices in the past five years – would not be enough on its own to ensure affordable power for all consumers, the alliance said. It comprises the Australian Industry Group, Brotherhood of St Laurence, CHOICE and the Energy Efficiency Council.

More work was needed to reduce demand and manage consumption, it said.

“Boosting energy efficiency will help households stay comfortable and improve business productivity while cutting electricity bills.”