In This Article:
* Coronado files IPO prospectus, sets A$4-A$4.80 price range
* IPO to give company enterprise value of up to A$4.4 billion
* IPO opens Oct 2 and expected to price around Oct 19 (Adds comment from Melbourne-based fund manager)
By Paulina Duran and Melanie Burton
SYDNEY/MELBOURNE, Sept 24 (Reuters) - U.S.-based Coronado Global Resources Inc launched what is set to be Australia's biggest coal mining float in six years with an IPO that seeks to raise up to A$1.3 billion ($946.1 million) and capitalise on Asian demand for the steelmaking commodity.
Coronado, which is backed by U.S. private equity firm Energy and Minerals Group (EMG), said in a statement on Monday it filed a prospectus for the IPO that will be priced at between A$4.00 and A$4.80 per share.
The IPO will give the company an enterprise value of up to A$4.4 billion, making it the biggest coal mining float in Australia since Yancoal Australia listed in 2012 at the peak of the country's mining boom.
"Demand from Asia for met coal, particularly from emerging economies, is expected to be strong and Coronado will be a key supplier to this growth market," Coronado Chairman Greg Martin said in the statement, referring to coal used for steelmaking, also called metallurgical coal.
Connecticut-based Coronado mainly produces metallurgical coal with annual output of 8.2 million tonnes from three U.S. mines and 8.5 million tonnes from the Curragh mine in Australia, which it bought from Wesfarmers Ltd in December for A$700 million.
That makes it one of the biggest metallurgical coal producers outside the big diversified miners, competing with U.S. firm Warrior Met Coal Inc.
It also produces 3.5 million tonnes a year of steaming coal, used for energy generation, at Curragh which it sells to the Queensland state government's power producer Stanwell Corp.
Metallurgical coal prices are back where they were at the start of the year at around $195 a tonne, having jumped by 20 percent from the start of August when they plumbed a nine-month low.
'TOUGH SELL'
Research firm Wood Mackenzie expects metallurgical coal prices to decline in coming years due to new coal supply and lower Chinese demand.
"It’s going to be a tough sell," said a Melbourne-based fund manager referring to Coronado's IPO, adding the price guidance meant the company was about 20 percent cheaper on a price-to-earnings ratio basis than Whitehaven Coal.
"It doesn’t have the growth of Whitehaven but it’s met coal which makes it probably a bit more investable in my mind,” he said, asking not to be identified because of his company's media policy.