On 13 June 2012, Whitehaven Coal Limited (WHC) announced that it had received a proposal from Tinkler Group Pty Ltd which was not capable of being progressed at that time. Immediately following receipt of that proposal, Whitehaven formed a committee of directors (Independent Board Committee or IBC) not associated with the bidder to consider any future developments.
On 13 July 2012, Whitehaven received an indicative and non‐binding proposal from Tinkler Group for a Tinkler Group led bid vehicle (BidCo) to take Whitehaven private by acquiring all of the ordinary shares of Whitehaven for $5.20 cash per share. The transaction would proceed by way of a scheme of arrangement. Tinkler Group has advised the IBC that it is intended that the transaction be structured as a general offer to all Whitehaven shareholders, with shareholders being offered $5.20 per share cash consideration, with a minimum of 48.3% of Whitehaven shares rolling into BidCo. BidCo may make available the opportunity for an additional up to 16.7% of Whitehaven shares to roll into BidCo. To the extent that less than 16.7% of shares elect to roll into BidCo, the additional cash required is expected to be funded by new equity.
Tinkler Group has advised the IBC that key Whitehaven shareholders, collectively representing approximately 48.3% of Whitehaven shares, have expressed interest in rolling their shares into BidCo, subject to satisfactory completion of due diligence and required documentation. The Tinkler Group proposal is also supported by conditional letters of support provided by senior lenders; UBS, JP Morgan and Barclays. Firm commitment of debt funds for the transaction remain subject to satisfactory completion of due diligence and detailed documentation.
The IBC has concluded that it is in the best interests of Whitehaven shareholders to enable Tinkler Group to conduct due diligence in order to further develop its proposal. In reaching this decision, the IBC has taken into account the premium represented by the proposed $5.20 per share offer price to recent Whitehaven share prices. However, the IBC notes that the proposal is still conditional and subject to a committed funding package.
