Peabody Energy - owners of Wilpinjong Coal mine - released a statement suggesting the proposal price implies a value for Macarthur at A$4.7 billion and represents a substantial premium to recent trading.

Under the proposal a newly formed company, owned 60 percent by Peabody and 40 percent by ArcelorMittal, would offer Macarthur shareholders a cash price of A$15.50 per share through an off-market takeover offer. The new company has a relevant interest of approximately 16 percent in Macarthur’s shares.

Peabody Chairman and Chief Executive Officer, Greg Boyce said significant value can be created by managing Macarthur’s portfolio of coal assets using Peabody’s industry-leading operating, development and commercial skills.

ArcelorMittal said it had been a long-term investor in Macarthur and looked forward to discussing their proposal with the board of Macarthur.

Macarthur is the world’s largest producer of seaborne low volatile pulverized coal injection coal with production and development assets in the Bowen Basin, Australia, including the Coppabella and Moorvale Joint Venture and Middlemount Mine.

It controls total coal reserves of approximately 270 million tonnes and total resources of approximately 2.3 billion tonnes. It has current production guidance of 3.8 to 4 million tonnes for the year ended June 30, 2011.