Oct. 20 (Bloomberg) -- Essar Group, the Indian company that runs telecom, energy, steel and real-estate businesses, withdrew from a bidding contest with Jindal Steel & Power Ltd. for Australian coal explorer Rocklands Richfield Ltd.
Rocklands has written to Essar asking why it’s dropping the A$144 Million ($134 million) bid, and to determine whether the Mumbai-based company may wish to continue the takeover on amended terms, the Sydney-based company said in a statement today. Its shares declined the most in eight weeks.
Rocklands, which controls three metallurgical coal projects in Queensland-state, has surged six fold in Sydney trading in the last six months, giving the company a market value of about A$107 million. The Jindal offer of 42 Australian cents a share remains “on track” with the New Delhi-based company continuing its due diligence, Rocklands said today.
The coal explorer dropped 21 percent to 33.5 Australian cents at 11:01 a.m. in Sydney, the biggest drop since Aug. 24. The benchmark S&P/ASX 200 Index rose 1.3 percent.
Jindal’s offer is preliminary, non-binding and conditional, Rocklands said today. Jindal owns 12.75 percent of the coal explorer, an Oct. 9 statement to the Australian stock exchange shows.
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