Whitehaven Coal is pleased to announce it has executed definitive sale agreements with BHP Group and Mitsubishi Development Pty Ltd to acquire 100% of both the Daunia and Blackwater coal mines in a highly attractive and transformative acquisition.
- Whitehaven to acquire 100% of the Daunia and Blackwater metallurgical coal mines from BMA for an aggregate cash consideration of US$3.2 billion1 comprising:
- US$2.1 billion upfront consideration payable on completion, and
- US$500 million, US$500 million and US$100 million in separate tranches of deferred consideration payable on the first, second and third anniversary of the completion date2.
- In addition, contingent payments of up to US$900 million; comprised of three annual payments (payable on the date which is three months after the relevant anniversary of completion) dependent on realised pricing exceeding agreed thresholds3, with annual contingent payments capped at US$350 million.
- To be funded via a combination of available cash, a US$900 million bridge facility and cashflows of Whitehaven’s enlarged business over FY2025, FY2026 and FY2027.
- Highly attractive acquisition for Whitehaven and is expected to be materially earnings accretive4, with upfront and deferred payments together implying an acquisition multiple of 1.8x EV / FY2024F EBITDA using spot prices and 2.9x using broker consensus coal prices5.
- Delivers significant value upside with attractive growth opportunities in Queensland’s Bowen Basin, including synergies with Whitehaven’s Winchester South development project.
- Transforms Whitehaven into a metallurgical coal producer in line with strategy, with pro-forma managed Run of Mine (“ROM”) production of around 40 million tonnes6 per annum and pro-forma revenues of around 70% metallurgical coal and 30% thermal coal7.
- Consolidates Whitehaven’s position as the leading Australian ASX listed metallurgical coal producer, with multiple benefits from increased diversification and scale.
- Increases exposure to attractive high-growth market regions including India and Southeast Asia, while strengthening and diversifying end market exposures currently focused on Japan, South Korea and Taiwan.
- Completion of the Acquisition is expected in the June 2024 quarter subject to satisfying conditions precedent including regulatory and merger control approvals.