Australia-listed Yancoal may go head-to-head with Glencore in a bidding war for Rio Tinto's Australian Hunter Valley thermal coal business Coal & Allied, offering $2.5 billion for Rio's stake, the company said in a filing to the Australian Stock Exchange Tuesday.
"If Rio Tinto determines that the Glencore proposal is a superior proposal, Yancoal will have the right to match or better that proposal," the company said.
The announcement follows Glencore making a counter-offer of $2.55 billion against Yancoal's $2.45 billion deal with Rio Tinto over last weekend.
Yancoal has won approval from China's National Development and Reform Commission for the acquisition.
The majority Chinese-owned miner also told the ASX that Mitsubishi, which owns a 32.4% share of Coal & Allied's Hunter Valley Operations joint venture, has accepted its $710 million tag-along offer.
The tag-along offer, which is a contractual obligation used to protect the minority shareholder, is conditional on the completion of the Coal & Allied transaction.
Glencore's bid included a $920 million conditional offer for both Mitsubishi's 32.4% interest in the HVO JV and for its 28.898% interest in the Warkworth JV.
Mitsubishi's acceptance of the Yancoal offer came earlier than the June 23 deadline. Meanwhile, Glencore's proposal to Rio Tinto will expire if a binding agreement is not executed by June 26.
The Hunter Valley Operations and Mount Thorley Warkworth mines together produced 25.9 million mt of saleable thermal and semi-soft coking coal in 2016, with Rio Tinto's share totaling 17.1 million mt..
Rio Tinto told the ASX Tuesday that it would give the Glencore proposal "appropriate consideration and respond in due course."
