Posco Buys Macarthur Stake After Mittal Purchase

By Shinhye Kang and Jesse Riseborough

June 30 (Bloomberg) -- Posco, Asia's third-biggest steelmaker, agreed to pay about A$424 million ($408 million) for a 10 percent stake in Macarthur Coal Ltd. after ArcelorMittal boosted its stake in the Australian producer.

Posco will pay A$20 a share pending board approval in July, Ko Min Jin, a spokeswoman for the Pohang, South Korea-based company, said today by phone. ArcelorMittal, the world's biggest steelmaker, said yesterday it paid the same amount per share to increase its stake in Brisbane-based Macarthur to 19.9 percent.


ArcelorMittal, Nippon Steel Corp. and Posco will continue to seek acquisitions of raw materials amid record prices for iron ore and coking coal, Merrill Lynch & Co. said June 6. China's Citic Resources Holdings Ltd. owns 17.66 percent of Macarthur, the world's largest exporter of pulverized coal used in steelmaking.

``There is still a lot of uncertainty about what the various parties are after,'' Michael Birch, who helps manage the equivalent of $140 million at Wallace Funds Management in Sydney, said today by phone. ``You have three big players in there in Arcelor, Posco and Citic. Theoretically you have got three buyers and you've got three blocking stakes.''

Macarthur fell as much as 70 cents, or 3.9 percent, to A$17.30 and traded at A$17.67 at 12:06 p.m. Sydney time on the Australian stock exchange, valuing it at A$3.8 billion.

Posco and ArcelorMittal both bought the shares from former Macarthur director Ken Talbot. ArcelorMittal bought 10.6 million shares, or 5 percent of the stock, from Talbot, the Luxembourg- based company said yesterday in a statement.

To contact the reporter on this story: Shinhye Kang in Seoul at skang24@bloomberg.net; Jesse Riseborough in Melbourne at jriseborough@bloomberg.net