The company recommended a £1.12 per share takeover bid from a subsidiary of Guangdong Rising Asset Management (GRAM), a state-owned Chinese mining company, back in September 2010. 

The deal is still awaiting the official sign-off from the Chinese authorities, and it is not expected to receive approval by the end of 28 February (today).

Last month the two parties agreed to extend the deals exclusivity period, by renewing a non-solicitation agreement, to 28 February. 

Li Jinming, chairman of GRAM, said "GRAM has been working very hard with the Chinese regulatory authorities during February and is confident the approval process is in its final stages."

Meanwhile in a separate statement Caledon revealed its preliminary results for the year ended 31 December 2010.

On a plus note the company returned to gross profitability in the second half of last year, but it wasn’t enough to overturn first half losses. For the twelve month period Caledon made a A$11.8 million net loss. 

Rising production and higher coal prices meant that annual revenue was up significantly with a 37% increase from A$67.8 million in 2009 to A$93 million in 2010.

Mark Trevan, managing director of Caledon, said "We are pleased to report that Caledon returned to a gross profit in the second half of the year as a result of increased production at the Cook mine and rising coal prices; however, this was not sufficient to offset the loss in the first half resulting in the company recording a full year loss."

“Caledon has a strong cash position following the recent £46 million financing in January, which ensures the Company can meet its development funding obligations for the Wiggins Island Coal Terminal.  

“The Cook mine returned to normal operations in mid January following the recent floods in Queensland and is well positioned to benefit from the expected higher coal prices going forward.

“Feasibility work at our neighbouring Minyango project continues and the granting of 4Mtpa allocation capacity at the new Wiggins Island Coal Terminal provides a clear development timeframe towards production in 2014."

While the Cook mine and its surface infrastructure had not been effected by the devastating floods that swept through eastern Australia, both road and rail access to the mine had been cut off.

The flooding did hamper production levels, sales levels and deliveries. The disruptions lasted through into the beginning of the current period, but the mine had returned to normal operation by the third week of January.

Rail access was restored from the Cook mine to the port of Gladstone on 20 January, and the first shipment (since the restart) left the mine recently.

However in the three months ended 31 December Caledon did manage to increase coal production – compared to the same period last year. 

It produced 170,000 tonnes of raw coal, 5 percent more than 2009. Coking coal production reached 116,000 tonnes and 27,000 tonnes of thermal coal were produced, representing growth of 6 and 79 percent respectively.

Caledon sold 116,000 tonnes of coking coal and 38,000 tonnes of thermal coal in the quarter.

The company also gave investors a quick update on the Minyango project, where it has now lodged a mining lease application over the initial mining area. It has also begun work on a voluntary environmental impact statement to support the application.

While the Cook mine and its surface infrastructure had not been effected by the devastating floods that swept through eastern Australia, both road and rail access to the mine had been cut off.

The flooding did hamper production levels, sales levels and deliveries. The disruptions lasted through into the beginning of the current period, but the mine had returned to normal operation by the third week of January.

Rail access was restored from the Cook mine to the port of Gladstone on 20 January, and the first shipment (since the restart) left the mine recently.

However in the three months ended 31 December Caledon did manage to increase coal production – compared to the same period last year. 

It produced 170,000 tonnes of raw coal, 5 percent more than 2009. Coking coal production reached 116,000 tonnes and 27,000 tonnes of thermal coal were produced, representing growth of 6 and 79 percent respectively.

Caledon sold 116,000 tonnes of coking coal and 38,000 tonnes of thermal coal in the quarter.

The company also gave investors a quick update on the Minyango project, where it has now lodged a mining lease application over the initial mining area. It has also begun work on a voluntary environmental impact statement to support the application.

Overnight Caledon’s Australian listed shares were suspended at the company’s request, pending an announcement regarding a proposed placing.

Crucially the fundraising allows the group to repay its debt to Polo, and therefore buys more time for Caledon’s Chinese suitor to finalise its £251.6 million takeover.

Back in November Caledon recommended the 112 pence takeover bid - which represented a 34 percent premium at that time – from a state-owned Chinese mining company, Guangdong Rising Assets Management (GRAM). 

However, like many similar state-sponsored Chinese takeovers, the final approval process in the People’s Republic has been taking longer than expected. On 31 December Caledon told investors that, as a result of the delay, it was unlikely to complete the GRAM deal before the repayment date for the Polo Resources loans (28 February 2011).

"GRAM remains committed to working with Caledon to complete the Potential Acquisition and continues to be actively engaged with Chinese regulators in the approval process, GRAM chairman Mr Li Jinming said.

Caledon was due to repay two separate loan in February, for £15.4 million and A$4 million respectively.

Intriguingly the placing announced this afternoon eclipses the outstanding debt. 

Caledon told investors that the additional capital provides additional security over its assets in Queensland (Minyango) and it strengthens the balance against the uncertainty caused by the flooding in the region. It will also cover potential development funding obligations.

Managing director Mark Trevan said: “The proceeds from this placement enable the company to discharge the loan obligations to Polo Resources and associated security over Minyango and significantly strengthen our balance sheet at a time when resumption of railings from the Cook mine, and therefore sales, remains uncertain.

“While the flooding continues to impact the railroad, it is pleasing to report that many of our employees are now able to return to work, and operations at the mine itself are starting to return to normal.  

“We have been fortunate that the Cook mine has not been structurally or geologically affected by the floods and anticipate a reasonably quick recovery to normal capacity once Queensland Rail is fully back in operation."

The group has conditionally placed £48.6 million, about A$76.7 million, with the new shares being priced at 90 pence - 5.6 percent discount.

In a notable facet of funding arrangements Polo - which currently hold 27.64 percent of Caledon - will participate in the placing to give it a total equity holding of 29.9 percent.

In a separate statement Polo confirmed that repayment’s due in February will be set off against a corresponding amount due to Caledon under the placing agreement.

In what will be a very common theme in coming weeks for Queensland miners, Caledon Resources (ASX: CCD) has reduced the forecast coal sales for 2010 from the Cook mine to 543,000 tonnes, from an advised range of 550,000 to 570,000 tonnes.

A force majeure has not been declared at Cook, which has already been declared at some other companies' coal mines due to the severe flooding over the past month.

Caledon said no significant damage has been sustained to the mine, although both road and rail access to the Blackwater township and the mine site has been repeatedly closed.

No announcements have yet been made as to the impact of coal sales from Cook for 2011.

It has added 874 million tonnes to the resource, which now stands at 1.2 billion tonnes.

A feasibility study is currently underway at Minyango.

The company is being taken over by a state-owned Chinese mining company - Guangdong Rising Assets Management (GRAM).

Minyango is around 15 kilometres away from Caledon’s operational Cook mine in Queensland, Australia.

The resource upgrade is the result of exploration work carried out between June 2009 and September 2010. 

The Cook mine is Caledon’s flagship asset. In 2009 it 604,000 tonnes of coal from Cook and the latest figures show the group’s raw coal production from operation rose 35% to 174 million tonnes of raw coal in the three months to the end of June.

It has targeted saleable output of 700,000 tonnes this year.

Caledon agreed the ‘chunky’ Chinese takeover bid, which valued it at £251.6 million, a 34 percent premium back in early November. 

GRAM has investments in a range of listed and unlisted entities across a wide range of sectors, including non-ferrous metals, technology, hotels and construction. It has recently been active in the mining sector having acquired a 19.9% interest in PanAust Limited, an ASX listed copper and gold mine operator for A$215 million in 2009.

Caledon’s takeover by the Chinese state owned investment firm at a chunky premium was announced on Monday.

Due diligence is now complete and the Australian Government's Foreign Investment Review Board has said that it has no objections to the transaction.

The offer values the Australian coking coal producer at £251.6 million, or a 34% premium to its closing price of 83.75 pence on 5 November and a 53% premium to its volume weighted average price of 73.16 pence for the 20 trading day period to 5 November.

It’s also notable that the premeium was achieved to a share price that had already been inflated by talks with several other parties.

In mid-September, Caledon announced a takeover approach, driving its shares up 15%.

A month earlier, the group broke off talks with would-be bidders.

In July Caledon told investors it received "a number of unsolicited and indicative enquiries from third parties in respect of possible alternative transactions".

Caledon’s flagship project is the formerly mothballed Cook mine in Queensland it bought in 2006.

In 2009, Caledon mined 604,000 tonnes of coal from Cook, up from 548,000 tonnes in 2008.

The latest figures show the group’s raw coal production from operation rose 35% to 174 million tonnes of raw coal in the three months to the end of June.

Caledon has targeted saleable output of 700,000 tonnes this year.

The group is currently carrying out a feasibility study on the neighbouring Minyango prospect, which it also bought back in 2006, which has a JORC compliant resource of 342 million tonnes.

GRAM has investments in a range of listed and unlisted entities across a wide range of sectors, including non-ferrous metals, technology, hotels and construction.

GRAM has recently been active in the mining sector having acquired a 19.9% interest in PanAust Limited, an ASX listed copper and gold mine operator for A$215 million in 2009.

The offer from the Chinese state owned investment firm values the Australian coking coal producer at £251.6 million, or a 34% premium to its closing price of 83.75 pence on 5 November and a 53% premium to its volume weighted average price of 73.16 pence for the 20 trading day period to 5 November.

Shares in Caledon jumped 22.5% in morning trade after the agreement in principle was announced.

“We believe the proposed acquisition of Caledon would be positive for our shareholders and our employees.

“If the acquisition proceeds, Caledon Shareholders and CDI Holders would receive, in cash, a very significant premium to Caledon's recent share price and GRAM's commitment to growing the business would provide our employees with the opportunities that come with being part of a much larger organisation,” said managing director of Caledon Resources Mark Trevan.

It’s also notable that such a substantial premium is to a share price that has already been inflated by intense takeover speculation and talks with several would-be bidders.

In mid-September, Caledon announced a takeover approach, driving its shares up 15%.

A month earlier, the group broke off talks with would-be bidders.

In July Caledon told investors it received "a number of unsolicited and indicative enquiries from third parties in respect of possible alternative transactions".

At that point the company described negotiations at being at an “early stage”, though one of the putative offers placed a price tag on the business of 68 pence a share, or £153 million.

GRAM expects to satisfy or waive the pre-conditions, which include the unanimous recommendation of the board of Caledon and the receipt of all necessary approvals from regulatory authorities in China, not later than 31 December 2010.

The directors of Caledon have indicated that they are supportive of the possible acquisition.

Caledon has advised shareholders that there is no certainty that a formal offer for Caledon by GRAM or its wholly owned indirect subsidiary Bidco will be forthcoming, even if the pre-conditions are satisfied or waived.

Caledon’s flagship project is the formerly mothballed Cook mine in Queensland it bought in 2006.

In 2009, Caledon mined 604,000 tonnes of coal from Cook, up from 548,000t in 2008.

The latest figures show the group’s raw coal production from operation rose 35 per cent to 174 million tonnes of raw coal in the three months to the end of June.

Caledon has targeted saleable output of 700,000 tonnes this year.

The group is currently carrying out a feasibility study on the neighbouring Minyango prospect, which it also bought back in 2006, which has a JORC compliant resource of 342 million tonnes.

GRAM has investments in a range of listed and unlisted entities across a wide range of sectors, including non-ferrous metals, technology, hotels and construction.

GRAM has recently been active in the mining sector having acquired a 19.9% interest in PanAust Limited, an ASX listed copper and gold mine operator for A$215 million in 2009.

Nearly to the day a month ago, the shares took a beating on news the group broke off talks with would-be bidders. It had been involved in a series of takeover negotiations this year.
Discussions started in April with 25 percent shareholder Polo Resources (LON:POL), though they eventually collapsed.

In July Caledon told investors it received "a number of unsolicited and indicative enquiries from third parties in respect of possible alternative transactions". At that point the company described negotiations at being at an “early stage”, though one of the putative offers placed a price tag on the business of 68p a share, or £153 million.

The deal was also characterised as “highly conditional” and “significantly undervaluing” the group - and therefore unlikely to receive boardroom support. News of the withdrawal of the indicative offer prompted last month’s sell-off.

In the latest episode of the takeover saga, Caledon noted the recent rise in the share price and confirmed it has received a further indicative approach and is again in preliminary discussions which may or may not lead to an offer for the group.

There is no certainty that an offer will be forthcoming and is advising shareholders to take no  action at this time.
Caledon’s flagship project is the formerly mothballed Cook mine in Queensland it bought in 2006.

In 2009, Caledon mined 604,000 tonnes of coal from Cook, up from 548,000t in 2008.

The latest figures show the group’s raw coal production from operation rose 35 per cent to 174 million tonnes of raw coal in the three months to the end of June.

Caledon has targeted saleable output of 700,000 tonnes this year.

The group is currently carrying out a feasibility study on the neighbouring Minyango prospect, which it also bought back in 2006, which has a JORC compliant resource of 342 million tonnes.

The Australian coking coal producer has been involved in a series of takeover negotiations this year.

Discussions started in April with 25 per cent shareholder Polo Resources (LON:POL), though they eventually collapsed.

Last month Caledon told investors it received "a number of unsolicited and indicative enquiries from third parties in respect of possible alternative transactions".

At that point the company described negotiations at being at an “early stage”, though one of the putative offers placed a price tag on the business of 68p a share, or £153 million.

The deal was also characterised as “highly conditional” and “significantly undervaluing” the group - and therefore unlikely to receive boardroom support.

Today the firm told investors: “Caledon has since been advised that the indicative offer has been withdrawn.”

It brings to a close an uncertain period in the recent history of the AIM and ASX listed Aussie miner, which in 2009 also held abortive bid talks with firms from China and India.

By midday on London the shares were down 12.5 per cent at 42p, though they were well off their session lows.

Caledon’s flagship project is the formerly mothballed Cook mine in Queensland it bought in 2006.

In 2009, Caledon mined 604,000 tonnes of coal from Cook, up from 548,000t in 2008.

The latest figures show the group’s raw coal production from operation rose 35 per cent to 174 million tonnes of raw coal in the three months to the end of June.

Caledon has targeted saleable output of 700,000 tonnes this year.

The group is currently carrying out a feasibility study on the neighbouring Minyango prospect, which it also bought back in 2006, which has a JORC compliant resource of 342 million tonnes.

Today's statement propelled Caledon shares up nearly 25 percent in late London trade to 47.75p.

On the 15th the company initially reported that it had received a number of “unsolicited and indicative enquiries”, including an offer to buy the company, since it terminated its merger talks with Polo Resources (LON:POL) on 24 June 2010.

The company has rarely been out of the M&A spotlight recently. The Polo deal was the most recent, when the companies initially agreed in principle back in April, however last month the companies announced a joint decision to terminate discussions, saying that “due primarily to recent market volatility, the parties have been unable to reach mutually agreeable terms”.

Based on the 11.4:1 exchange ratio, and Polo’s 5.4p closing price (26th April), the offer has an implied price of 61.56p per share – representing a 14.53% premium.

"The proposed combination offers diversification for Caledon shareholders through Polo's investments in resource companies and its joint venture in Mongolia, while retaining shareholders' exposure to the upside potential contained within our Cook mine and Minyango project”, Caledon MD Mark Trevan commented.

According to the statement, the proposed merger would create a coal-focused natural resources company with investments in geographically diverse exploration and development projects, and direct exposure to the currently high coking coal prices through the producing Cook mine.

“The combined strength of Polo and Caledon's balance sheets will also reduce the risk inherent in financing the development of the Minyango project (in Queensland, Australia).  Access to Polo's strong management team with particular emphasis on capital markets experience will also be a major benefit", Trevan added.

Polo is already Caledon’s largest shareholder, with 54.4 million shares which represents 25.94% of the company, and furthermore through this significant shareholding it has had two non-executive directors appointed to the board - David Weill and Stephen Dattels (Polo co-chairman).

Caledon noted that its independent directors indicated that they are supportive of the proposed merger, and that they currently intend to unanimously recommend the offer. The independent directors and Polo, both believe that the combination represents a clear and compelling strategic fit.

"The transaction will provide all Polo shareholders with a renewed focus and direct exposure to the coking and thermal coal markets through 100% ownership of the Cook mine and the Minyango project", Polo Executive Chairman Neil Herbert said.

Additionally, Caledon and Polo have today entered into two loan facility agreements, whereby Polo will provide Caledon with £18 million and A$4 million respectively.

Under the first agreement, Polo will provide a short-term £18 million credit facility to be used, if required, to aid the repayment of Caledon's 8.5% convertible loan notes, due 5 July 2010.  The first facility will be available for drawdown in the period between 14 June and 20 July 2010, and it will mature on 31 October 2010. 

Secondly, Polo will provide a A$4 million credit facility for the potential lodgment of a bid bond associated with the Wiggins Island tonnage allocation process.  The second facility is available for drawdown immediately until the 1 June, and it will mature on 30 September 2010.

Each agreement is subject to interest at a rate of 10% pa.

Caledon operates the Cook underground coking coal mine and is working towards a feasibility study of the nearby Minyango coking coal deposit in Queensland.

In 2009, Caledon mined 604,000 tonnes of coal from the Cook mine, up from 548,000t in 2008. Coking coal production amounted to 406,900t against the previous year’s 378,000t, while coking coal sales increased from 397,000t of to 403,000t. The company has produced and sold 79,000t and 76,000t of thermal coal during the year, compared to 66,000t produced and sold in 2008.

Also during 2009, Cook’s JORC compliant resource was increased by 230Mt (million tonnes) to 406Mt and the Minyango Resource by 50Mt to 342Mt. The company intends to increase production from to 700,000t in 2010.

Polo Resources has a number of projects, shareholdings and joint ventures which are split between two resources - coal and uranium. Currently, Polo has three strategic shareholdings with its 25.94% stake in Caledon, a 29.83% interest in GCM Resources (AIM: GCM) and a 9.3% interest in Namibia-operating uranium company Extract Resources (ASX, TSX: EXT).

Earlier this month, Polo’s Co-Chairman Dattels announced his decision to step down as a non-executive director of Extract Resources. Polo recently hired BMO Capital Markets to evaluate strategic options with regards to its Extract shareholding.

Extract Resources is conducting a Definitive Feasibility Study (DFS) at Rossing South, in Namibia, and  last month the company said that the DFS, which is expected to confirm the project's potential as one of the world's largest uranium mines, is progressing well.

Based on the 11.4:1 exchange ratio, and Polo’s 5.4p closing price (26th April), the offer has an implied price of 61.56p per share – representing a 14.53% premium.

"The proposed combination offers diversification for Caledon shareholders through Polo's investments in resource companies and its joint venture in Mongolia, while retaining shareholders' exposure to the upside potential contained within our Cook mine and Minyango project”, Caledon MD Mark Trevan commented.

According to the statement, the proposed merger would create a coal-focused natural resources company with investments in geographically diverse exploration and development projects, and direct exposure to the currently high coking coal prices through the producing Cook mine.

“The combined strength of Polo and Caledon's balance sheets will also reduce the risk inherent in financing the development of the Minyango project (in Queensland, Australia).  Access to Polo's strong management team with particular emphasis on capital markets experience will also be a major benefit", Trevan added.

Polo is already Caledon’s largest shareholder, with 54.4 million shares which represents 25.94% of the company, and furthermore through this significant shareholding it has had two non-executive directors appointed to the board - David Weill and Stephen Dattels (Polo co-chairman).

Caledon noted that its independent directors indicated that they are supportive of the proposed merger, and that they currently intend to unanimously recommend the offer. The independent directors and Polo, both believe that the combination represents a clear and compelling strategic fit.

"The transaction will provide all Polo shareholders with a renewed focus and direct exposure to the coking and thermal coal markets through 100% ownership of the Cook mine and the Minyango project", Polo Executive Chairman Neil Herbert said.

Additionally, Caledon and Polo have today entered into two loan facility agreements, whereby Polo will provide Caledon with £18 million and A$4 million respectively.

Under the first agreement, Polo will provide a short-term £18 million credit facility to be used, if required, to aid the repayment of Caledon's 8.5% convertible loan notes, due 5 July 2010.  The first facility will be available for drawdown in the period between 14 June and 20 July 2010, and it will mature on 31 October 2010. 

Secondly, Polo will provide a A$4 million credit facility for the potential lodgment of a bid bond associated with the Wiggins Island tonnage allocation process.  The second facility is available for drawdown immediately until the 1 June, and it will mature on 30 September 2010.

Each agreement is subject to interest at a rate of 10% pa.

Caledon operates the Cook underground coking coal mine and is working towards a feasibility study of the nearby Minyango coking coal deposit in Queensland.

In 2009, Caledon mined 604,000 tonnes of coal from the Cook mine, up from 548,000t in 2008. Coking coal production amounted to 406,900t against the previous year’s 378,000t, while coking coal sales increased from 397,000t of to 403,000t. The company has produced and sold 79,000t and 76,000t of thermal coal during the year, compared to 66,000t produced and sold in 2008.

Also during 2009, Cook’s JORC compliant resource was increased by 230Mt (million tonnes) to 406Mt and the Minyango Resource by 50Mt to 342Mt. The company intends to increase production from to 700,000t in 2010.

Polo Resources has a number of projects, shareholdings and joint ventures which are split between two resources - coal and uranium. Currently, Polo has three strategic shareholdings with its 25.94% stake in Caledon, a 29.83% interest in GCM Resources (AIM: GCM) and a 9.3% interest in Namibia-operating uranium company Extract Resources (ASX, TSX: EXT).

Earlier this month, Polo’s Co-Chairman Dattels announced his decision to step down as a non-executive director of Extract Resources. Polo recently hired BMO Capital Markets to evaluate strategic options with regards to its Extract shareholding.

Extract Resources is conducting a Definitive Feasibility Study (DFS) at Rossing South, in Namibia, and  last month the company said that the DFS, which is expected to confirm the project's potential as one of the world's largest uranium mines, is progressing well.

Caledon own and operates the Cook Mine in the Bowen Basin in Queensland, Australia, where it produces coking coal for export into Asia.  The mine utilizes cutting edge underground mining methods installed by Caledon after it acquired the operation in late 2006. The Company also owns the nearby Minyango exploration concession and is a founding shareholder in Wiggins Island Coal Export Terminal Pty Ltd, the company which is tasked with developing a new coal loading terminal to support development of Minyango.

Caledon announced on 27 February 2009 that it had engaged RBC Capital Markets to conduct a strategic review of the business. This lead to a number of non-binding, conditional written indications of interest to acquire the Company. In August, Caledon confirmed that one of its suitors was Indian mining group, Essar Minerals.

Caledon confirmed this morning that its potential suitors had failed to make a firm offer for the company: “…despite the high level of interest and recognition of both the quality of Caledon's assets and the scarcity of high quality coking coal assets in general, no party has yet provided a final and binding offer.”

As a result of the absence of a firm offer, Caledon stated that it had decided its best chance of maximising value for shareholders was to concentrate on developing its assets, especially in light of stronger coal prices and forecasts of higher prices in 2010.

Caledon also provided an update on its current activities.  Saleable production from the Cook Mine for 2009 is forecast to be in the region of 485,000 tonnes, of which 405,000 tonnes will be coking coal and 80,000 tonnes will be thermal coal.  Base production in 2010 is expected to forecast to be 700,000 tonnes. 

Unfortunately, the strong Australian dollar hasn’t helped the company’s bottom line. For the six month period ending 31 December 2009, the company expects to post a loss of A$3.5 million – A$5.0 million compared to first half after tax loss of A$7.7 million. During the second half, the Australian dollar has appreciated against the US dollar, which resulted in a 22% decrease in A$ revenue per tonne.

On a more positive note, continued demand from both China and India is expected to place upward pressure on the 2010 coking coal contract prices.  Caledon added that analysts were forecasting the annual contract price negotiations would “more than compensate for the exchange rate movement”.

Caledon is a coking coal producer and explorer in the Bowen Basin of Queensland, Australia. It acquired the mothballed Cook Mine in late 2006 and has since re-commissioned the operation and introduced a new underground mining methodology. The Company also purchased the nearby Minyango exploration concessions in 2006 and has conducted a number of drilling programs in preparation for a feasibility study.

The primary mining operations in the northern Magatar system has now stopped, operations in this area are now focussed on secondary extraction of previous workings using a company owned Joy 12CM12B miner and shuttle cars. According to Caledon, there are sufficient workings in this area for this to continue until early 2010.

The intermittent production in the older Northern section of the mine is set to increase in the fourth quarter before it’s progressively sealed off as mining is completed and equipment moved to the new Argo pit. Across the entire Cook mine, Caledon forecast the production of saleable coal of approximately 0.5m tonnes for 2009.

At the neighbouring Minyango project, Caledon released bulk sampling which indicated the coking coal quality sits comfortably in the sought after low volatile and low sulphur category. Subsequently consultants have also been engaged to undertake a base line ecological study in preparation for the environmental permitting process with this work due to commence in early November. Exploration expenditure on Minyango during the quarter was AUD$338,000.

The quarter has also seen continued interest in Caledon from prospective Acquirers.  Earlier this year, the company engaged RBC Capital Markets to conduct a strategic review following receipt of a non-binding, conditional written indication of interest from a party interested in acquiring the Company.  Subsequently RBC solicited interest from other parties. 

In this morning’s statement, Caledon re-iterated that discussions with a number of potential acquirers are ongoing.

In conducting a strategic review the company received a non-binding indication of interest from a party interested in acquiring the Company.

Tracking the improved outlook for coking coal, a number of parties that have not previously had access to Caledon’s data room have approached the company to be included in the Process.

Separately, the company has sought to gain a better understanding of the coal quality at Minyango.  The results indicate the coking coal quality that can be produced at Minyango confirm that it sits comfortably in the sought after low volatile and low sulphur category.

The company purchased the Minyango exploration concessions in the Bowen Basin near to the company's Cook mine, and has conducted a number of drilling programs in preparation for a feasibility study.

Work is also due to commence in Q4 2009 on a baseline ecological study in preparation for the environmental permitting process. This is a long lead time component of the BFS and granting of the ML. Consultancy support to develop the BFS is planned to be engaged in 2010.