LONDON: BHP and Mitsubishi Development Pty Ltd (MDP) have completed the divestment of the Blackwater and Daunia mines to Whitehaven Coal.
Daunia and Blackwater were part of the BHP Mitsubishi Alliance (BMA) metallurgical coal joint venture in Queensland. Each of BHP and MDP hold a 50% interest in BMA.
Whitehaven Coal has paid BMA US$2.0 billion cash consideration on completion plus a preliminary completion adjustment of US$44.1 million for working capital and other agreed adjustments (100% interest basis). Whitehaven Coal paid a US$100 million deposit on signing of the Asset Sale Agreement on 18 October 2023.
US$1.1 billion cash remains payable by Whitehaven Coal to BMA over 3 years after completion and a potential additional amount of up to US$900 million in a price-linked earnout may also be payable by Whitehaven Coal to BMA over 3 years (100% interest basis). The price-linked earnout is subject to a cap of US$350 million each year and depends on average realised pricing exceeding agreed thresholds for each of the 3 years following completion on 2 April 2024.
The total cash consideration for the transaction will be up to US$4.1 billion plus the final completion adjustment amount.
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