News Wrap

IN THIS morning’s News Wrap: Yanzhou may have to pay $265 million to secure Yancoal deal; Clive Palmer to lose right to operate port; and wave of sackings at Forrest's Poseidon nickel venture .

Staff Reporter

Yanzhou may have to pay $265 million to secure Yancoal deal

Yanzhou may be forced to spend $265 million to wipe away a block of special shares agreed to under a previous merger deal as part of its bid to privatise its subsidiary, Yancoal Australia, according to the Australian Financial Review.

Chinese coal company Yanzhou launched its $200 million scrip offer to buy the remaining 22% of shares it does not own in locally listed Yancoal yesterday.

But the bid does not recognise the contingent value rights negotiated by Gloucester directors for their shareholders prior to the merger with Yancoal.

It offered Gloucester shareholders downside protection if the 90-day volume-weighted average share price falls below $6.96 a share.

Clive Palmer to lose right to operate port

Clive Palmer is being confidentially put on notice that Deputy Prime Minister Anthony Albanese's department is taking legal steps to strip his company, Mineralogy, of its lucrative rights to operate the major new port for China's $7 billion-plus iron ore project in Western Australia, according to The Australian.

An internal review of sensitive information has reportedly led to a high-level decision in the Department of Infrastructure and Transport to start the process of removing Mineralogy as operator of the security-regulated port of Cape Preston, near Karratha.

Wave of sackings at nickel mine swamps Forrest's Poseidon adventure

Poseidon Nickel chairman Andrew Forrest's bid to revive the historic Windarra project in the face of worsening nickel prices appears to have suffered a blow, with more than 40 contractors sacked amid speculation the company is attempting to preserve cash, according to The Australian.

The suspension of drilling at the Windarra nickel site this week comes after Forrest, the 32% owner of Poseidon, and chief executive David Singleton returned empty-handed from New York last month following a bid to secure about $200 million in debt financing for the project.

The job losses at Poseidon follow a wave of redundancies at other mining companies and contractors in the wake of weaker commodity prices.