Secretive London hedge fund emerges as Whitehaven’s bête noir

afr.com:

The investor pushing to stop Whitehaven Coal’s acquisition of two major BHP mines in a multibillion-dollar deal is secretive London hedge fund Bell Rock Capital Management, The Australian Financial Review can reveal.

The Daunia and Blackwater mines in Queensland – expected to receive bids of between $US3.5 billion ($5.4 billion) and $US5 billion – were put up for sale by BHP and its joint venture partner, Japan’s Mitsubishi, in February.

The Daunia coal mine in Queensland is one of two put up for sale by BHP and its partner, Japan’s Mitsubishi. 

Whitehaven is far from the only group in the race, with the Financial Review’s Street Talk column reporting other shortlisted parties include Yancoal Australia, Coronado Global Resources and BUMA Australia.

But Bell Rock has been increasingly aggressive in its campaign against the acquisition, although its identity has previously not been known publicly. Whitehaven has only identified the party as a “UK-based investor” in a letter to shareholders who received a call polling them on their views.

With a market capitalisation of some $6 billion, the acquisition of the two major mines in Queensland would be a significant change for Whitehaven. BHP cited two reasons for selling the mines, a process which is being conducted by Macquarie Capital: the company wants to focus on commodities required for a transition to cleaner energy generation, and a Queensland tax hike which made the economics of the mine more difficult.

As Street Talk has reported, Bell Rock has – without disclosing its identity – engaged EMRS, a third-party research house, to poll investors. That survey found an overwhelming number of respondents agreed that “increased shareholder returns through payment of dividends”