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New Hope shares rocked by Mitsubishi's selloff

Business

Japanese company Mitsubishi Materials has dealt New Hope Group mining another blow by selling its $159 million stake in the company.

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New Hope Group has been dealt a major blow with its second-biggest shareholder, Mitsubishi, selling its 11 per cent stake in the company.

The sale of the stake led to a 14 per cent, or $238 million, wipeout of the company’s shares on the market on Friday.

Reuters reported the shares were sold in one block, off-market.

It is another blow to New Hope after it has faced falling prices and protracted court cases preventing the $1 billion expansion of its Acland coal mine, near Oakey. The delays forced the company into sacking 150 people in November.

In its most recent report the company said the Acland project suffered from “continued inaction” by the State Government.

The court case surrounding its expansion could now be heading to the High Court after the Oakey Coal Action Alliance sought leave to appeal a decision from the Queensland courts. That move has prevented the State Government from granting any approvals.

The decision by Mitsubishi after 30 years on the shareholder register is understood to be part of the change in strategy for the company.

Neither New Hope nor Mitsubishi made comment, but Reuters reported that the sell-off was not linked to public pressure on the coal industry over its carbon emissions.

Thermal coal is used to produce energy as well as to make cement. Global institutional investors have been ramping up pressure on companies to exit the emissions-heavy commodity on climate change concerns.

 

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