The Australian share market has had a mixed session so far, with health and tech stocks dragging, while mining and energy stocks have been on the rise.
- BHP is selling its 80 per cent stake in a Queensland metallurgical coal joint venture
- Priceline owner API has recommended shareholders vote in favour of a buyout offer from Wesfarmers
- Travel stocks rose as Sydney Airport’s board backed a $24 billion takeover deal
By 12:30pm AEDT, the ASX 200 was 0.1 per cent lower at 7,446.8 points.
Gains in the materials and energy sectors helped offset some of the losses elsewhere, with BHP shares rising by 1.4 per cent.
The mining giant announced the sale of its stake in a Queensland metallurgical coal joint venture for up to $US1.35b ($1.8 billion).
Stanmore Resources will buy BHP’s 80 per cent stake in BHP Mitsui Coal for an initial payment of $US1.1 billion cash, a further $US100 million in six months and a potential $US150 million follow-up payment after two years, depending on coal prices.
Shares in Stanmore Resources leapt 15.2 per cent higher.
“The transaction is consistent with BHP’s strategy,” the miner’s head of Australian minerals, Edgar Basto, said.
The joint venture includes the South Walker Creek and Poitrel mines in Queensland’s Bowen Basin.
Other miners were also on the rise, including Rio Tinto (+1.3pc), Fortescue (+0.1pc) and South32 (+2.6pc).
Gold mining stocks were among the best performers on the benchmark index, with St Barbara (+6.1pc), Evolution Mining (+5.4pc) and Regis Resources (+3.6pc) rising strongly.
Financial stocks mostly weighed on the market, as ANZ (-2.1pc) and Macquarie Group (-1pc) dropped as they traded without access to their latest dividend payments.
The healthcare sector was on track for its worst performance in three weeks, with losses for CSL (-0.9pc), Resmed (-1.8pc) and Sonic Healthcare (-2.6pc).
Wesfarmers shares lost 1.1 per cent, as the company secured a deal to take over pharmacy group API for $764 million.
Shares in API lifted 2.4 per cent on the news, which follows rival bidder Sigma withdrawing its proposal to merge with API last week.
API owns brands including Priceline, Soul Pattinson Chemist and Pharmacist Advice.
The company’s board has recommended shareholders vote in favour of the Wesfarmers deal.
Travel stocks rise on airport deal
Sydney Airport shares lifted 2.8 per cent after its board backed a takeover by a group of superannuation funds and infrastructure investors.
The $24 billion buyout deal, one of the largest in Australian corporate history, will need the approval of the competition regulator and the Foreign Investment Review Board, as well as shareholders.
The Sydney Aviation Alliance comprises Australian investors IFM Investors, QSuper and AustralianSuper and US-based Global Infrastructure Partners.
Sydney Airport shares are now up around 30 per cent since January, after plunging during the depths of the pandemic.
Other travel stocks lifted, including Flight Centre (+4.6pc), Webjet (+2.4pc) and Qantas (+3.9pc).
US jobs growth lifts global markets
On Friday, global markets rose, following a rebound in jobs growth in the United States.
Non-farm payrolls increased by 531,000 in October and the unemployment rate fell to 4.6 per cent.
On Wall Street, the S&P 500 rose 0.4 per cent for the session, adding 2 per cent over the week.