Mystery Whitehaven investor in eleventh-hour push to kill BHP coal bid

afr.com:

With the clock ticking on binding bids at BHP’s Blackwater and Daunia coal mines in Queensland, one suitor for the mega assets is facing opposition from its shareholders in what could be a windfall for rival bidders.

Whitehaven Coal is among the short-listed parties for the coking coal mines – with initial bids at between $US3.5 billion ($5.4 billion) and $US5 billion – alongside Yancoal Australia, Coronado Global Resources and BUMA Australia.

But at least one major investor on Whitehaven’s register appears to be unhappy at the thought of the ASX-listed miner paying out that much money for the two mines, concerned that the company would withhold dividends to pay for it at a time when the price of coking coal is falling and with the Queensland government more than happy to slap higher taxes on the industry.

The Daunia coal mine in Queensland.  

Then there’s the mystery market research being carried out by EMRS, a third-party agency clearly hired by a disgruntled investor. A summary of the research, obtained by Street Talk, concludes that “larger shareholders are also substantially less supportive of using cash reserves to fund new acquisitions, and strongly opposed to borrowing to make new acquisitions”.

“The research was undertaken to understand the priorities and expectations of Whitehaven’s management by shareholders in relation to the proposed acquisition of Daunia and Blackwater mines in the Bowen Basin,” it reads, noting that the survey, taken in the last week of July, had 272 respondents.

An overwhelming number of respondents agreed that “increased shareholder returns through payment of dividends” should be a priority, while a clear majority of larger shareholders disagreed that the company should “increase