Peabody Reduces Macarthur Bid to $3.4B

Peabody Energy submitted a reduced proposal to acquire a controlling interest in Australia's Macarthur Coal partly because of a new tax in Australia on mining profits.
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ST. LOUIS (

TheStreet

) --

Peabody Energy

(BTU) - Get Report

submitted a reduced proposal to acquire a controlling interest in Australia's

Macarthur Coal

partly because of a new tax in Australia on mining profits.

Peabody, the U.S. coal miner, is now offering 15 Australian dollars a share, down from A$16 a share. The total offer falls to $3.4 billion from $3.8 billion.

Peabody said its offer still represents a 31% premium to Macarthur's average price in March.

"The definitive proposal delivers a clear, compelling and significant premium for Macarthur shareholders, and follows Peabody's due diligence as well as the introduction of the Australian resources profit tax proposal," Peabody said in a statement late Sunday.

The Australian government last month established a new 40% tax on the profits of resource companies starting from 2012.

Macarthur said its board would meet to consider the latest Peabody proposal.

-- Reported by Joseph Woelfel in New York.

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