Yancoal
(ASX:YAL) has announced a US$2.5 billion equity raising, which will provide funding for the 100 per cent acquisition of Coal and Allied from Rio Tinto
(ASX:RIO).
The Australian coal producer and developer will launch a entitlement offer to raise about US$2.35 billion.
Meantime, the remaining cash required to fund the Coal and Allied purchase will be funded through a fully committed share placement to strategic investors.
The company says it's also simplify its capital structure, with Yanzhou committing to convert as many of its Subordinated Capital Notes as permitted.
Yancoal says the purchase of Coal and Allied is a compelling proposition and gives the company opportunity to become Australia’s largest pure-play coal producer.
Shares in Yancoal
(ASX:YAL) last traded at $0.39. It will commence trading today after a prior suspension of trading.
