South32 scraps US$200m acquisition of Australian coal mine from Peabody

Melbourne

SOUTH32 Ltd on Tuesday killed a US$200 million deal to buy Peabody Energy's Metropolitan coal mine in Australia after running into competition concerns about supply of coal to local steel makers.

South32, which had been pursuing its first major acquisition since being spun off by global miner BHP Billiton, said that it was unwilling to take the steps required to appease Australian steel makers to get the deal over the line. "To proceed with the acquisition, in light of the anticipated concessions, would have compromised the merits of the transaction - and this is not something we are prepared to do," South32 chief executive Graham Kerr said in a statement.