Gloucester doesn't expect bid approval

Gloucester chairman Andy Hogendijk told a meeting on the proposed scheme of arrangement covering the Xstrata bid that the company expected major shareholders, the Noble Group and AMCI, to vote against the proposal.

"We have been advised that AMCI will vote against the scheme and expect Noble also to vote against the scheme," Mr Hogendijk said.

"We expect that the scheme will therefore not be approved."

Mr Hogendijk said Noble and US coal major AMCI had become significant shareholders on Gloucester's register, holding a stake of about 10 per cent in the company, and Noble previously had made an unsolicited approach to the company.

He said that indicative proposal had been conditional, incomplete and less than the Xstrata offer.

Xstrata Coal made a $4.75 a share offer, which was unanimously recommended by Gloucester's directors, in April.

Mr Hogendijk said the board and Gloucester would continue to carry out the business plan, financial and operating strategies, put in place before the proposed scheme.

That would include continuing to seek a new chief executive to replace Gavin May whose contract is due to expire on July 31. This process was at an advanced stage.

It would also include continuing to optimise the company's operations, continue its successful exploration programme to identify further resources in the Gloucester basin and to review the miner's capital management program and dividend policy in light of current capital requirements and improved outlook for coal prices.

"With the ownership issue resolved, and the improved demand for coal, we believe the outlook of Gloucester Coal is very promising," he said.