Argyle, Sinarmas Arm Offer to Buy Coal Miner ARMS
Bengaluru. Asia Coal Energy Ventures (ACE) and hedge fund Argyle Street Management offered to buy the stake they do not already own in coal miner Asia Resource Minerals for 41 pence per share.
ACE’s offer, which values ARMS at 98.8 million pounds ($150.5 million), is a 7.2 percent premium to the stock’s closing price on Wednesday.
ARMS, previously known as Bumi, has been struggling with boardroom battles and tumbling coal prices. The company recently renegotiated debt and issued shares to turn its fortunes around.
The Indonesia-focused miner also received potential interest from a trust controlled by British financier Nat Rothschild and the parent of Russia’s Siberian Coal Energy Co last month.
The company delayed a general meeting intended to approve the share issue as a result of the potential bids.
An ACE spokesman said the company’s offer was conditional on ARMS shareholders voting against the share issue in the meeting, to be held on May 14.
ACE said it had received an irrevocable undertaking to accept the offer from Ravenwood in respect of about 57.4 million ARMS shares, representing a 23.81 per cent stake.
ACE, which is managed by Argyle Street Management and funded by Indonesia’s Sinarmas Group, had indicated its interest to make a 41 pence per share offer in mid April.
Since then, ARMS shares have gained 155 percent to the stock’s Wednesday close.
The stock was up 3.2 percent at 39.50 pence at 0748 GMT on the London Stock Exchange.
ACE and Argyle also said on Thursday they would invest $150 million in ARMS and implement a bond restructuring.
Argyle holds a 4.65 percent stake in ARMS, said a joint statement with ACE.
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