Grant Samuel slings Singapore lenders for Stanmore’s BHP coal tilt

afr.com:

Stanmore Resources is fronting lenders once again as it hunts for nearly $1.25 billion in debt to bankroll its bid for BHP’s up-for-grabs Blackwater and Daunia mines in Queensland.

Street Talk understands the acquisitive listed miner and its adviser Grant Samuel held meetings with prospective lenders in Singapore last week. Global alternative bigwig Varde Partners is in talks to come in as an anchor investor on the deal, sources said.

Stanmore knows the playbook well, having won BHP’s auction to sell 80 per cent of BHP Mitsui Coal – Poitrel, South Walker, Wards Well mines – last year. It raised $US625 million ($972 million) in debt and $US506 million in equity via a rights issue which saw its Indonesian backer GEAR assume $US300 million to bankroll the purchase.

It followed up by buying out Mitusi’s 20 per cent stake later in 2022.

BHP is in the process of selling two of its Queensland mines, Daunia and Blackwater, but has kept its most valuable coking coal mines, including Goonyella, Riverside, Peak Downs and Saraji. AFR

Stanmore has shown it can muster the support of equity as well as debt capital markets for big M&A plays. It has also performed well, posting 36 per cent increase in revenue to $US1.5 billion and 46 per cent increase in net profit to $US340 million for the June half.

However, Daunia and Blackwater together are expected to be worth north of $US3 billion and Stanmore would first have to see off other shortlisted bidders, Whitehaven Coal, BUMA Australia and Peabody Energy, who have all been lining up their funding as well.

Yancoal Australia is understood to have tapped out in recent weeks, while other logical bidders New Hope and Coronado Global Resources checked out early in the auction.

Sell-side adviser