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DealBook: Australian Mining Companies Aston Resources and Whitehaven Coal In Talks For $5 Billion Merger

December 5, 2011 by Leave a Comment

Tony Haggarty, chief of Whitehaven Coal.Ian Waldie/Bloomberg NewsTony Haggarty, chief of Whitehaven Coal.

LONDON — The coal developer Aston Resources said on Monday that it was in discussions with another Australian miner, Whitehaven Coal, on a potential merger valued at almost $5 billion.

Aston, headquartered in Brisbane, has an 85 percent stake in the Maules Creek Project in Western Australia that is highly valued because of its large resources of thermal coal. Despite growing concerns about the global economy, commodity prices — particularly for materials used to fuel fast-growing countries like China and Brazil — have continued to increase.

“Aston remains committed to its stated strategies and growth of the company on a stand-alone basis,” the company said in a statement. “However, the Aston board continues to explore other alternatives available to it to maximize value for Aston shareholders.”

Aston and Whitehaven, based in Sydney, said no agreement had yet been reached.

The announcement comes a month after Aston replaced its management team, including the chief executive, Todd Hannigan, a former manager at the mining giant Xstrata, and after the resignation of the company’s chief financial officer, Tom Todd.

The markets reacted positively to the news. By the end of trading in Australia, Aston’s share price had risen 4.17 percent, valuing the company at $1.98 billion. Whitehaven reported a smaller increase of 1.24 percent, giving the company at market capitalization of $2.88 billion.

Article source: http://feeds.nytimes.com/click.phdo?i=7ce99eb88f8ab7f269a6350385e713ae

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DealBook: Silver Lake Consortium to Submit Offer for Stake in Yahoo

November 29, 2011 by Leave a Comment

Yahoo headquarters in Sunnyvale, Calif.Tony Avelar/Bloomberg NewsYahoo is said to be considering selling a 20 percent stake in itself.

8:28 p.m. | Updated

A consortium of investors led by the private equity firm Silver Lake and Microsoft is one of several parties that will be submitting a plan to take a minority stake in Yahoo, according to people briefed on the matter.

TPG Capital, another private equity firm, is also expected to submit a proposal, these people said. Both plans involve taking as much as a 20 percent stake in Yahoo.

Yahoo’s financial advisers at Allen Company and Goldman Sachs had set the end of business on Monday as a deadline for offers for a minority stake in company, these people said. Yahoo’s board is expected to discuss the matter as soon as this week.

These people briefed on the matter requested anonymity because they were not authorized to discuss private negotiations. Representatives for Silver Lake, Microsoft, Yahoo and TPG declined to comment.

Yahoo appears increasingly less interested in selling itself as a whole. In recent weeks, the company’s directors and advisers have gravitated toward plans that call for an investor or consortium to buy a stake of as much as 20 percent. Yahoo would then take on debt to finance a stock buyback.

Coupled with the roughly 10 percent stake that is held by Yahoo’s co-founders, Jerry Yangand David Filo, the maneuver would effectively give the winning investor group a majority holding.

But the board may still consider bids for the entire company, according to a separate person who is close to the company but was also not authorized to discuss the negotiations.

Silver Lake, Microsoft and its consortium, which will most likely include the venture capital firm Andreessen Horowitz, may be particularly attractive to Yahoo, which is seeking to bolster its leadership on the product and finance side. Yahoo has not named a chief executive since the board ousted Carol A. Bartz in September. The company has been run on an interim basis by Timothy Morse, but the board has hired an executive search firm to look for a permanent replacement.

In recent weeks, the Silver Lake group discussed the possibility of installing Marc Andreessen, a co-founder of Netscape and a co-founder of Andreessen Horowitz, as a Yahoo board member, three of the people briefed on the matter said. Mr. Andreessen has also been in discussions with Yahoo’s management team, one of these people said, for a possible role at the company.

Other private equity firms, including Kohlberg Kravis Roberts and Hellman Friedman, may also participate in a minority investment, one of these people said.

Potential investors are expected to firm up details of their proposals in the coming days, these people said.

One of Yahoo’s biggest partners, meanwhile, the Alibaba Group of China, an e-commerce company, is holding discussions with private equity firms like the Blackstone Group about forming a bid to buy all of Yahoo, according to people briefed on those discussions.

Because of rights associated with Yahoo’s 40 percent stake in Alibaba, the Chinese company is considered to wield significant power. Alibaba has expressed interest in buying back its stake from Yahoo, though the two sides are not in discussions, one of these people said.

Some Yahoo shareholders are likely to look askance at any minority investment. Third Point, the hedge fund run by Daniel S. Loeb, sent the company’s board a letter earlier this month that said he was “deeply concerned” about that possibility. Mr. Loeb also called on Mr. Yang to step down from Yahoo’s board and indicated that he would be willing to try to oust other directors.

Shareholders like Third Point have called on Yahoo to run a full sales process that includes bids for the entire company.

Andrew Ross Sorkin contributed reporting.

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DealBook: Softbank Offloads Yahoo Stake to Repay Citigroup Loan

August 26, 2011 by Leave a Comment

Masayoshi Son, chief of Softbank.Jo Yong-Hak/ReutersMasayoshi Son, chief of Softbank.

TOKYO – The Japanese Internet and telecommunications company Softbank said Friday that it would offload most of its 4 percent stake in Yahoo to Citigroup to pay off a $1.1 billion loan.

The sale is the latest step in a gradual unraveling of once-close relations between Yahoo, Softbank and another Asian Internet company, Alibaba.

Softbank said in a statement that it would transfer its Yahoo shares to Citigroup to return a $1.136 billion loan it took out in 2004. Under an agreement made at the time, Softbank would repay either in cash or Yahoo shares.

Softbank’s chief executive, Masayoshi Son, has been openly critical of Yahoo’s pace of innovation. The portal site Yahoo Japan, operated by Softbank, now uses Google technology instead of Yahoo’s. Meanwhile, Alibaba’s founder, Jack Ma, has been keen to buy back Yahoo’s 40 percent stake in the Chinese company.

Because Yahoo’s share price has slumped almost 50 percent since then, Softbank’s stake is worth about $660 million. After the transfer, the Japanese company’s stake in Yahoo will fall to 0.002 percent.

Softbank, which runs Japan’s third-largest wireless network, owns 42 percent of Yahoo Japan, while Yahoo in the United States has 35 percent. There has been speculation that Yahoo is looking to shed its stake in the joint venture.

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DealBook: Fiat to Raise Its Chrysler Stake to 46%

April 22, 2011 by Leave a Comment

A Fiat dealership in Milan.Luca Bruno/Associated PressA Fiat dealership in Milan. Fiat seeks “effective legal control” of Chrysler.

7:01 p.m. | Updated

Fiat, the Italian automaker, said on Thursday that it would raise its stake in the Chrysler Group to 46 percent and acquire a majority stake in the company this year.

Fiat increased its stake to 30 percent this month. It said it would pay $12.3 billion to acquire an additional 16 percent once Chrysler paid off the roughly $7 billion it owes the American and Canadian governments.

Fiat, based in Turin, Italy, and Chrysler, based in Auburn Hills, Mich., are working with their banks to refinance the debt before the end of June. Fiat will then exercise a $1.3 billion equity call option for the 16 percent stake, with the money adding to Chrysler’s capital. Fiat will draw on its cash reserves of more than 14 billion euros ($20.4 billion) to buy the stake.

Sergio Marchionne, the chief executive of both companies, said in a conference call with analysts that Fiat expected to obtain an additional 5 percent of Chrysler this year, raising its total to 51 percent and giving it “effective legal control.”

Fiat has had management control of Chrysler since a 2009 deal with the Obama administration gave Fiat a 20 percent stake in the American company in exchange for technology and financial aid.

In the meantime, Mr. Marchionne said, raising Fiat’s stake to 46 percent will allow the two companies to consolidate their results for accounting purposes and “provide a much-needed base for a fuller operational integration of these businesses.”

Asked if he was talking about a full merger, Mr. Marchionne said, “I’ve always said from a governance stance that it doesn’t make sense to have two separate companies.” He cautioned that he could not predict “how we might get there,” emphasizing that integration at the business level was more important than legal integration.

Mr. Marchionne has been saying for some time that he hoped to hold an initial public offering of Chrysler shares as early as this year, but he has been more cautious recently. Speaking on that subject in the conference call, he said, “I think a lot of it depends on market conditions and the performance of Chrysler.”

He noted that any stock offering would be subject to discussions with Chrysler’s Voluntary Employee Benefit Association, which received a majority of the nearly worthless stock in Chrysler at the time of the government rescue in exchange for the money it was owed by the company.

As part of the 2009 deal with the Obama administration, the Italian company agreed to a series of performance goals that, once met, would allow it to increase its holdings. On Jan. 10, Fiat increased its stake to 25 percent, after meeting the first target, laying the groundwork for American production of an engine based on Fiat’s FIRE family (for fully integrated robotized engine).

On April 12, Fiat said it had met the second target, producing Chrysler sales of at least $1.5 billion outside of North America, and raised its stake to 30 percent. It said it expected to meet the last of the three targets — sales in the United States of a Fiat platform car that gets 40 miles per gallon — by the end of the year.

Shares of Fiat, which trade in Milan, were up 4.6 percent in afternoon trading.

On Wednesday, Fiat said first-quarter revenue rose 7.1 percent, to 7 billion euros ($10.2 billion), from the period a year earlier. It shipped 518,600 passenger cars and light commercial vehicles in the quarter, down 2.6 percent from the period a year earlier. Net profit rose 24 percent, to 37 million euros.

It will break out Chrysler earnings next month.

Article source: http://feeds.nytimes.com/click.phdo?i=4942b97da0d05b43ebb00e0cf44118ba

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