After more than a year, Peabody Energy’s dogged pursuit of a major Australian coal company now appears to have succeeded.
Spurning earlier offers from St. Louis-based Peabody, the board of directors at Macarthur Coal Ltd. announced this morning that it would recommend that shareholders accept a sweetened $5.2 billion bid from Peabody and its partner ArcelorMittal, the world’s largest steelmaker.
The deal gives Peabody Energy Corp. and its minority partner control of the world’s biggest maker of pulverized coal used by steelmakers. It also expands Peabody’s coal output in Australia, the world’s largest coal-exporting nation.
“This is a major step forward in our acquisition process,” Peabody Chairman and Chief Executive Officer Gregory H. Boyce said in a press release. “We are pleased to have Macarthur, Peabody and ArcelorMittal moving forward together to urge shareholders to accept this attractive premium.”
Peabody, the biggest U.S. coal miner, and ArcelorMittal raised their bid to 16 Australian dollars a share from 15.50 Australian dollars, which now values the company at 4.8 billion Australian dollars, or $5.2 billion. The offer is 44 percent more than the stock’s close before the initial bid July 11.
The market for coking coal is increasingly lucrative. Credit Suisse Group AG in July raised its price forecasts for coking coal by an average 15 percent for 2014 to 2018, citing “unrelenting” demand. Prices rose 47 percent to a record $330 a ton for three-month contracts starting April 1 and have traded close to records.
The chase began on March 30, 2010, when the St. Louis-based coal company offered to buy the Australian company for $3 billion. Eventually, Peabody offered as much as $3.8 billion before it was turned away after a two-month pursuit.
However, Peabody was not to be deterred. Last month, the St. Louis-based company teamed up with ArcelorMittal, which owns 16 percent of Macarthur. The two companies, through a jointly owned venture, offered 15.50 Australian dollars for each Macarthur share.
When the board rejected that offer three weeks ago, the two companies threatened to take the offer directly to shareholders.
WHITE KNIGHT?
After receiving the Peabody-ArcelorMittal bid, Macarthur began talks with other possible suitors in the hopes of finding a white knight.
Macarthur’s board said it accepted the 16 Australian dollar offer in the absence of any competing bids that were superior.
“In the period since the initial offer, a number of parties have conducted due diligence,” the company said in the statement. “Although it remains possible that a superior proposal might be made, none have emerged to date, and there can be no assurances that any will emerge.”
Anglo American Plc is exploring a bid for Macarthur, according to two people with knowledge of the matter. Teck Resources Ltd. and Yanzhou Coal Mining Co. may also be interested, the Australian Financial Review said in its Street Talk column last month, without citing anyone.
However, Macarthur’s shares rose to as much as 15.94 Australian dollars this morning, indicating investors don’t yet expect any counterbid.
Peabody and ArcelorMittal have the right to match any competing offer, and Macarthur faces a breakup fee of 48.3 million Australian dollars under the terms of the agreement.
The bid is being made through PEAMCoal Pty, a venture 60 percent owned by Peabody and 40 percent owned by Luxembourg-based ArcelorMittal.
The Peabody group’s bid for Macarthur will be the second-largest coal takeover this year, second only to Alpha Natural Resources Inc.’s $7.1 billion purchase of Massey Energy Co. in June. This year has yielded about 50 coal transactions globally, with a combined value of more than $20 billion.
Police on Sunday arrested a 28-year-old man on suspicion of attempted murder of two Metropolitan Police officers during the height of the London riots earlier in August.
The suspect, who has not been named, is suspected of taking part in the early morning attack that left two policemen hospitalized with knee, leg and shoulder injuries.
The officers, who were chasing looters leaving a The Aristocrats clothing store in northeast London, came under direct attack when a green Citroen was driven directly at them at high speed.
One of the policemen was hit so hard that his body armor came off.
The two officers are now recovering from their injuries at their homes.
The incident happened at 1 a.m. on Aug. 8, the second night of rioting and looting that hit London and other British cities in the worst urban violence in several decades.
Police said the suspect is in custody after being arrested Sunday. Another suspect was arrested earlier and set free on bail as investigations continue.
U.K. police have arrested more than 3,000 people over riots that erupted in north London and flared for four nights across the capital and other English cities.
The departure of Steve Jobs from the role of CEO leaves Apple Inc. with a deep bench of executives who have been with the company for more than a dozen years
Brown Shoe Co. is unloading the men’s basketball brand AND 1 from its portfolio about six months after the company procured it as part of the acquisition of American Sporting Goods.
The Clayton-based footwear company said today that it was selling the brand for $55 in cash to Galaxy International, a newly-formed brand management company. Brown Shoe said it would use the proceeds from the sale to pay down debt.
In February, Brown Shoe completed its $145 million acquisition of American Sporting Goods, which also includes the brands Avia and Ryka. The acquisition of the athletic shoe company was part of Brown Shoe’s strategy to increase its offerings in the active and healthy living category.
“AND 1 is a great brand with a strong heritage, however, it did not cleanly align with our strategy to focus on the key consumer platforms of healthy living, contemporary fashion and family,” Diane Sullivan, the company’s chief executive, said in a statement.
When Sullivan took over the reigns of the company as chief executive in May, she said one of her top priorities would be evaluating Brown Shoe’s portfolio of brands and divesting from those that don’t fit into its strategic focus in key categories fast cash. She said she will continue to review brands in the second half of this year.
The company also reported its earnings today for the second quarter. It had a net loss of $4.6 million, or 11 cents a share, compared to a profit of $5.3 million, or 12 cents a share, in the same period last year. The company blamed the drop in part on a more rapid-than-expected decline in toning footwear and to some continuing costs associated with the implementation of a new information technology system.
Net sales in the quarter rose 7.2 percent to $628 million, up from $586 million. The company attributed much of the gain to the increased sales from the American Sporting acquisition.
There
Round a bend in Cambodia’s Tatai River and the virtual silence of a tropical idyll turns suddenly into an industrial nightmare.
Lush jungle hills give way to a flotilla of dredgers operating 24 hours a day, scooping up sand and piling it onto ocean-bound barges. The churned-up waters and fuel discharges, villagers say, have decimated the fish so vital to their livelihoods. Riverbanks are beginning to collapse, and the din and pollution are killing a promising ecotourism industry.
What is bad news for the poor, remote Tatai community is great tidings for Singapore, the wealthy city-state that is expanding its territory by reclaiming land from the sea. Sand from nearby countries is the prime landfill and also essential building material for Singapore’s spectacular skyline.
As more countries ban its export to curb environmental damage _ entire Indonesian islands have been all but wiped off the map _ suppliers to Singapore scour the region for what still can be obtained, legally or not. Cambodia, a poor country where corruption is rife and laws are often flouted, is now the No. 1 source.
Singapore is by no means the only nation taking part in what is a global harvest of sand from beaches, rivers and seabeds. Officials and environmentalists from China to Morocco have voiced concern and urged curbs. As construction booms in emerging economies and more sources dry up, however, exploitation of the remaining ones is likely to intensify.
Sand mining began anew in May on southwestern Tatai River, which empties into the ocean almost directly north of Singapore, across 1,300 kilometers (800 miles) of open water.
Despite denials by the main owner of sand mining rights in Koh Kong province, two Cambodian officials told The Associated Press that the sand is destined for the island nation.
Singapore will not say where its sand comes from; the Construction and Building Authority said it is not public information. The National Development Ministry said the state’s infrastructure development company buys it from “a diverse range of approved sources.”
The mining visible on the Tatai River clearly violates some of Cambodia’s own legal restrictions, not to mention a recent government order to suspend it temporarily.
Vessels of a Vietnamese company were tracked by boat from about 10 kilometers (6 miles) upriver to the Gulf of Thailand, where nearly a dozen seagoing barges, tugs hovering around them, took on the sand.
The AZ Kunming Singapore, a 5,793-ton (5,255-metric ton) barge pulled by the AZ Orchid, was seen arriving empty from the open ocean, its tug flying a Singaporean flag. Both are registered with the Singapore government, which would not comment on the barge’s cargo or destination.
Ships from several countries, including China, were spotted in sand-mining operations in Koh Kong province, where residents joked about going to Singapore and planting a Cambodian flag there.
The vessels included one from Winton Enterprises, a Hong Kong-registered group that was subcontracted to export sand to Singapore, according to Global Witness, a London-based environmental group that published a detailed account of the trade last year.
The report said that miners had penetrated protected mangrove, estuary and sea grass areas, breeding grounds for marine life along a coastline and hinterland harboring some of the country’s last wilderness areas.
Cambodia’s cabinet spokesman, Siphan Phay, who was investigating the issue in Koh Kong, appeared angry that the temporary halt order was being ignored. He described the activity as illegal mining destined for Singapore, a surprising statement given that government ministers awarded the concession.
A police officer in the economic crime division, who demanded anonymity given the issue’s sensitivity, also said the sand is going to Singapore.
Ly Yong Phat, who holds the major concession in Koh Kong, has at times openly acknowledged the Singapore connection. But in a recent AP interview, amid tightening restrictions and mounting criticism, he said his company had not shipped sand to Singapore for more than a year because “our sand did not meet their standards.”
The dredging, he added, was for local sale and to deepen river channels.
However, a Malaysian company, Benalec Holdings, said it was ready to tap up to 530,000 tons for a reclamation project in Singapore from several sources in Cambodia, including Ly Yong Phat’s LYP Group.
Known as the “King of Koh Kong,” Ly Yong Phat is one of Cambodia’s biggest tycoons and a senator with close ties to Prime Minister Hun Sen. His holdings include hotels, a casino and agricultural plantations.
Land reclamation has enlarged Singapore by more than a fifth, and up to 100 square kilometers (nearly 40 square miles) more are slated for reclamation by 2030. What was once seabed is now Changi, among the world’s finest airports, and more recently the Marina Bay complex, which includes a 2,560-room hotel and casino developed by Las Vegas Sands Corp.
Mountains of sand are needed for such fills. U.N. statistics show Singapore imported 14.6 million tons last year, ranking it among the world’s top customers. Global Witness estimated that nearly 800,000 tons a year, worth some $248 million, were streaming to Singapore from Koh Kong alone.
The U.N. figures show that Cambodia supplied 25 percent of Singapore’s imports in 2010, followed by Vietnam, Malaysia, Myanmar and the Philippines. With its secrecy and lax enforcement of environmental regulations, Myanmar could emerge as a major supplier.
The damage caused by sand extraction has spurred clampdowns on exports.
Malaysia imposed a ban in 1997, though the media there frequently report on massive smuggling into neighboring Singapore. Former Prime Minister Mahathir Mohamad complains that sand pirates are “digging Malaysia and giving her to other people.”
An Indonesian ban came in 2007, following years of strained relations with Singapore over the sand on islands lying between the two countries. When miners finished with Nipah Island, reportedly all that was left was three or four palm trees protruding above the waterline. Environmental groups say smuggling is believed to be continuing.
Vietnam banned exports late last year.
Cambodia outlawed the export of sand from rivers in 2009 but allows it from some seabeds. Recently, some government officials said that rivers where seawater flowed into fresh water, replenishing sand naturally, were exempt.
Global Witness spokesman Oliver Courtney said the trade in Cambodia revealed a “mismatch between Singapore’s reliance on questionably sourced sand and its position as a leader for sustainable development.” The city-state prides itself on environmentally sound urban planning.
The dredging of the Tatai River began on May 17 “with a fury,” creating a veritable traffic jam on the water, said Janet Newman, owner of the riverside Rainbow Lodge.
“Before you could see crab pots bobbing in the river everywhere and fishermen going out. Now there is nothing and nobody,” the British woman said.
Chea Manith of the Nature Tourism Community of Tatai said 270 families along the river have seen an estimated 85 percent drop in catch of fish, crab and lobsters and were being forced to eke out a living from small garden plots. Tourists have all but vanished.
Armed with a petition, village leaders, tourism operators and a wildlife group met with Ly Yong Phat in early July. He appeared sympathetic, Newman said. He substantially reduced the dredging and has promised to stop altogether in October.
A subsequent letter from the Minister of Water Resources and Meteorology ordered the LYP group to halt operations temporarily on the Tatai, citing a breach of regulations. The letter was obtained by Cambodia’s Phnom Penh Post newspaper, which made it available to the AP.
Hun Sen himself expressed concern over the mining in the river.
“We hoped that the prime minister’s recent promise to review the impacts of the sand trade would lead to proper regulation of dredging operations,” said Courtney of Global Witness. “Unfortunately, the pledge does not appear to have been followed up with meaningful action.”
The mining has continued on the Tatai, and violations, such as dredging closer than 150 meters (165 yards) from riverbanks, were clearly evident.
The Post also obtained a Ministry of Industry, Mining and Energy letter extending LYP Group’s concession in Koh Kong until Sept. 2012.
“We are just little people. We cannot do anything,” Chea Manith said.
Newman sounded a more optimistic note. “It’s my hope that the LYP Group will become sympathetic through this experience of having seen the reaction from people passionate about protecting their environment,” she said. “It would be sad if they just went somewhere else to dump the same on others.”
Thousands of striking Verizon workers will return to work starting Monday night, though their contract dispute isn’t over yet.
Both the company and the union say they have agreed to narrow the issues in dispute and have set up a process to negotiate a new contract. But the talks are likely to be contentious. The two sides still disagree on touchy subjects such as health care benefits, pensions, and work rules.
About 45,000 employees went on strike on Aug. 7, after their previous contract expired. They work in the company’s landline division in nine states from Massachusetts to Virginia.
Verizon says that it needs to cut costs in the traditional landline phone business, which is in decline as more Americans switch to mobile phones. The company has proposed freezing its pension and switching union workers to its non-union health plan, which has higher costs for employees.
The unions counter that the landline business supports the growing wireless business and that Verizon, which earned about $3 billion in the first half of the year, can afford to maintain the benefits in the contract that expired on Aug. 6. They also say Verizon put too many proposals on the table.
Of the 45,000 striking workers, 35,000 are covered by the Communications Workers of America, while 10,000 are covered by the International Brotherhood of Electrical Workers.
Jim Spellane, a spokesman for the IBEW, said the strike occurred because Verizon “came in with an extreme set of proposals and never really moved off of them.”
But after the 14-day strike, “I think they realized the unions are serious,” he said. “It’s in everybody’s best interest to get back to work.”
Verizon spokesman Richard Young said that many of the benefits and work rules were put in place when Verizon faced much less competition in its landline business. “The contracts are not reflective of today’s marketplace,” he said.
Spellane said that much of the traditional phone network helps support the faster-growing wireless business. And many of the technicians that went on strike install and maintain the company’s new fiber optic network, FiOS, which provides Internet, video and phone services.
Verizon has 196,000 workers, with 135,000 of those non-union. The wireless division, which wasn’t affected by the strike, is mostly non-union.
Nearly 30 percent of U.S. homes have dropped landline phone service and rely on mobile phones only, according to the National Center for Health Statistics.
Verizon Wireless added 1 paperless payday loans.3 million wireless customers in the April-June quarter, for a total of 89.7 million. That growth has been helped by the addition of Apple Inc.’s iPhone in February. The company owns 55 percent of Verizon Wireless, with Britain’s Vodafone owning the rest.
Meanwhile, total voice connections, which measures FiOS digital voice connections in addition to traditional landlines, declined 7.9 percent to 25 million. But the company has seen increases of more than 20 percent in customers subscribing to both FiOS Internet and TV services over the past 12 months.
Candice Johnson, spokeswoman for the CWA, said Verizon is asking $20,000 per worker in annual concessions. The company has disputed that but hasn’t offered its own figure.
Johnson said earlier this month that the union’s best-paid Verizon workers get about $77,000 a year in New York. The company puts the figure at $91,000 and said benefits average $50,000.
“These are very important issues” being negotiated, she said. “They are issues that help families ensure a middle-class life.”
While union workers walked the picket lines, managers and non-union employees performed their duties.
Verizon’s Young said the company began training managers and non-union workers at the beginning of the year to prepare for the strike. Thousands of employees were brought in from as far away as Texas, California, and Colorado, he said. They have worked 12 hours a day, six days a week, he said.
The company also used newer technologies to resolve 50,000 problems a day remotely, Young said, such as resetting set-top boxes and routers and testing lines.
Peter Thonis, Verizon’s chief communications officer, acknowledged there was “a little bit of a slowdown” in installing new services like FiOS, but said replacement workers largely kept up on repair work.
The company said in its statement that it will “quickly address any backlog in repairs and unfulfilled requests for service.”
While customers who will now get their FiOS services installed on time may be winners, Verizon’s Thonis said neither the company nor the workers could claim a victory.
“We still have a lot of hard and difficult bargaining to do. None of the major issues that were on the table before the strike, are off the table,” he said.
____
AP radio correspondent Julie Walker contributed to this report.
WASHINGTON
SABMiller PLC, one of the world’s largest brewers, has launched a hostile $10 billion bid Wednesday for Australian rival Foster’s Group Ltd. after its board rejected a takeover offer.
The maker of Peroni, Grolsch and Miller Lite said it is taking the 4.90 Australian dollars ($5.13) per share cash offer, minus any dividend Foster’s chooses to pay out, straight to shareholders and that the offer would be funded by existing resources and new debt.
The London-headquartered company said Foster’s had so far declined to consider a similar offer made in June. The Australian brewer said the bid significantly undervalued the company.
SABMiller had said in June that Foster’s was attractive because it was Australia’s leading brewer with seven of the top 10 beer brands, and buying the company was consistent with its strategy to spread globally. It considers Australia an attractive market because of its population growth and economic connections to Asia.
SABMiller, which is listed in London and Johannesburg, said it had a proven track record of integrating brewing companies and improving the performance of those businesses.
SABMiller said it had decided to make the offer to the shareholders directly as Foster’s board showed “no willingness” engaging with the offer.
SABMiller shares were up 0.5 percent at 21.29 pounds ($34.88) Wednesday morning.
Moviegoers may want to take two bites of the same apple next year: A pair of live-action adventure flicks based on Snow White will come out in theaters just months apart.
As it stands, the first, still-unnamed Snow White movie is scheduled for release March 16. That gives moviegoers two and a half months before “Snow White and the Huntsman” on June 1.
Executives are confident that both projects can succeed, given their differences in stars, tone and plot.
However bizarre the coincidence is, history shows that two similar projects like these can both attract large audiences.
In May 1998, viewers turned out for “Deep Impact,” a movie about a comet threatening Earth. They showed up again that July when an asteroid did the same in “Armageddon.” “Deep Impact” sold $349 million in tickets worldwide, and “Armageddon” followed with $555 million.
Audiences didn’t duck for cover either when “Dante’s Peak” blew in February 1997 only to have “Volcano” erupt that April. The first made $169 million and the other $120 million at the box office.
The latest standoff pits a couple of “frenemy” studios against each other _ newbie studio Relativity Media and its longtime distribution partner, Universal Pictures.
Since 2005, Relativity had provided financial backing for most of Universal’s new movies in a deal that was to last through 2015. But Relativity has been eager to make money from distributing as well, as it did with the March 8 release of “Limitless,” which has sold more than $150 million in tickets worldwide.
So in June, Relativity passed its co-financing deal with Universal to Relativity’s financial backer, Elliott Management. That paved the way for the two studios to compete head to head _ Relativity with the unnamed movie and Universal with “Huntsman.”
“Everybody kind of goes into this eyes wide open,” said Tucker Tooley, Relativity’s president of worldwide production. “It’s the nature of competition. It’s the nature of this business.”
Universal executives declined to comment.
Executives argue that the two Snow White movies are spaced far enough apart so that advertising one won’t inadvertently drive people to the other.
Most movies make 95 percent of their sales in the first four weeks. On average, people in North America see four movies a year. There’s plenty of time to get refreshed and go out again.
“Ten weeks in the movie business is a lifetime,” said “Huntsman” producer Joe Roth.
He should know. Roth was head of Disney’s studios when its “Armageddon” opened second but still sold $200 million more in tickets worldwide than “Deep Impact.”
The casts of both Snow Whites are also distinct enough to merit a return trip to the theater.
In Relativity’s version, billed as a family comedy, Julia Roberts is in for an intriguing role reversal as the former “Pretty Woman” plays the Evil Queen.
“She’s a very fun and evil and wicked Evil Queen,” said producer Bernie Goldmann, who also produced “300.” Nathan Lane is set to add a humorous touch as a bumbling Huntsman.
In Universal’s epic action adventure, Kristen Stewart of “Twilight” fame gets “Karate Kid”-like fight training from buff Chris Hemsworth of “Thor.” Hemsworth plays the mercenary Huntsman, who disobeys orders to kill her. The action-packed movie also involves a love triangle with Prince Charmant, played by Sam Claflin.
“At its heart, it becomes a girl’s empowerment movie,” Roth said.
Timing and casting aside, Snow White is a tale that has been told many times with many different plot twists. These versions follow that tradition.
In an early Italian retelling, the good guy we know from Disney’s 1937 animated classic as Prince Charming rapes Snow White while she’s sleeping, according to Tina Boyer, a professor of German at Wake Forest University. She awakes not to a kiss, but to her baby being born. Another tale has Snow White fleeing her father, not her wicked stepmother, because he’d like to make her his incestuous wife.
Relativity’s movie has Snow White teaming up with the seven dwarves to fight the Evil Queen. In Universal’s, she teams up with the Huntsman to fight back.
Reading the 20-plus different versions is partly what inspired Melisa Wallack to write her own take in the script that Relativity later bought, said Goldmann, Wallack’s husband.
“It enabled us to understand that there was a lot of freedom in expanding the story,” he said.
Evan Daugherty had written the other Snow White script while he was a film student at New York University many years ago. He also takes many liberties with the plot. Universal, now owned by Comcast Corp., bought it following a bidding war.
It helped that “Alice in Wonderland” sold $1 billion at the box office last year and revived interest in classic stories that feature young girls and have fallen out of copyright protection.
Even if producers of both projects saw success and jumped on the bandwagon, there aren’t enough complex roles for young women these days anyway, said Marjorie Rosen, a professor of film and journalism at Lehman College. Having characters as rich as Snow White and the Evil Queen on screen is a blessing, Rosen said, even if there are going to be two versions of them.
She said pent-up demand for strong female leads has led to the success of a slew of recent bride movies, from “27 Dresses” and “Bride Wars” to the recent “Bridesmaids.”
“Women were lining up for the first week or two because they were desperate for movies about them,” Rosen said. “Maybe (the studios) are hoping that Snow White is kind of like that but better.”
And if there’s two, why not a third? Word has it that Disney has been working on a live-action remake of its animated classic for the past decade. In that one, Snow White ends up in a forest with seven Shaolin monks.
At its core, each iteration is about a dysfunctional family, something that touches everyone at some level. That may be why the story is still relevant today.
“They can take the basic themes if they want to and go with it because that’s what fairytales and folklore are all about,” said Wake Forest’s Boyer. “They have to be reinvented. That’s how they stay alive.”
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