Resource Pacific Accepts Xstrata Offer

123jump.com Staff
19 Feb, 2008
New York City

Resource Pacific accepted Xstrata offer of $3.20 per share or $1.08 billion after 50% of shareholders accepted the offer. The four month long battle for a coal miner comes on the back of rising prices of metals, energy, and minerals. OneSteel, second largest alloy producer reported first half profit for the period ending in December 2007 of $104.4 million, an increase of 6.3%. Seperately Newcrest Mining reported a loss of $8.1 million.

[R]3:00AM New York, 7:00PM Sydney - ASX 200 index gained 1.1% and Resource Pacific accepts Xstrata offer.[/R]

Market Sentiment

ASX 200 index rose 1.1% or 54.6 to close at 5,619.10.

The Preliminary market turnover was 1.45 billion shares worth $6.22 billion, with 604 stocks moving up, 588 moving down and 352 unchanged. The most actively traded stock was Broad Investments with 51.23 million shares worth $206.9 million.

Market Driver

The world''s second-largest winemaker, Foster''s Group Ltd''s stock fell 1.5% today after announcing a 6% rise in profit before items to $393.5 million for the six months ended December 31 2007.

The company''s net sales revenue fell 0.5% to $2,356 million while EBITS was 3.5% higher at $635 million and earnings per share were up 9.7% to 20.1 cents.

However the company did not repeat gains from the sale of its Asian breweries a year earlier resulting in net income for the half declining by 28%.

The company blamed slowing consumer demand in the U.S. and a rising Australian dollar weighing down earnings and revenue.

Gainers and losers

Of the ASX 200 index stocks, Boom Logistics led the gainers with a rise of 29.9% followed by increases in Perilya Limited of 23.5%, in APN/UKA European of 11.4%, in Mincor Resources of 8.7%, and in AXA Asia Pacific of 8.5%.

Of the ASX 200 index stocks, Centro Properties led the decliners with a fall of 17.5% followed by losses in Mount Gibson Iron of 8.7%, in Centro Retail Group of 7.5%, in AED Oil Limited of 7% and in Sunland Group of 6.4%.

Debt concerns weighs down Centro''s share

Centro Properties'' share fell 17% today on concerns that it underestimated its maturing debt and also stated that it would increase the amount on its short-term debt.

Centro yesterday won a reprieve after getting an extension of its deadline from Friday to April 30 on its $4.9 billion debt.

Newcrest in $8.1 million loss

Australia''s largest gold producer, Newcrest Mining Ltd today announced an $8.1 million loss for the six months ended December 31 last year.

The loss of 2.1 cents a share was recorded after the gold miner spent $2 billion on bullion at near record prices to meet forward sales contracts.

The company''s profit after-tax profit excluding one-time loss was up 184% to $207.9 million while operating EBITDA was up 80% to $450.4 million. Gold production was up 18%. Newcrest''s share rose 3% after the news.

Oil Search to sell assets

Papua New Guinea''s biggest oil producer, Oil Search Ltd today hinted on the possible sale of some of its assets in the Middle East and Africa.

The company wants to use the revenue generated to improve its ability to finance liquefied natural gas projects. Speaking via a conference call, Managing Director Peter Botten said that the company was facing challenges in financing its $10 billion LNG project in Papua New Guinea as reported on AAP and by Bloomberg.

Oil Search owns about 30% of the LNG project that is headed by Exxon Mobil Corp led venture. The venture is expected to decide on the engineering and design work of the project next month to start engineering and design work on a $10 billion LNG project that would almost triple the company''s output. Oil Search gained 2.3%.

Resource Pacific accepts Xstrata''s offer

Australian coal producer Resource Pacific Ltd today indicated that it has agreed to Xstrata Plc''s $1.08 billion takeover offer after Xstrata garnered more than 50% share.

Resource Pacific''s acceptance of Xstrata''s $3.20 a share bid finally ended four months of jostling for the mid-size coal producer.

Resource Pacific runs the Newpac colliery, which neighbours Xstrata mines in the Hunter Valley region of New South Wales State. It produces about 4 million tons of coking and thermal coal a year and has plans to double output by 2010.

OneSteel registers a profit

Australia''s second-largest alloy producer, OneSteel Ltd today announced a net operating profit after tax of $104.4 million in the six months to December 2007, up 6.3% from the $98.2 million profit of the corresponding period last year.

OneSteel Limited Managing Director and Chief Executive Officer, Geoff Plummer said the profit excluded restructuring costs and impairment of plant and equipment.

The net statutory profit after tax, after restructuring costs, and impairment of plant and equipment associated with the Smorgon Steel integration, was $74.6 million.

Geoff Plummer said, ""Highlights of the six months were the significant progress on OneSteel''s two major growth initiatives of Project Magnet and the merger and integration of the Smorgon Steel businesses.

He said the company was on track to ramp up to 4 million tons of external iron ore sales in this financial year after sales of almost 1.9 million tons in the period under review. The most recent estimate of the cost of the project will be approximately $400 million, compared with the previous forecast of $395 million.

He added that the merger with Smorgon Steel Group that was completed on 20 August and the integration of the businesses was on target. OneSteel''s share fell 2.5%.