07/01/2013 20:35:00

Whitehaven Shares Hit After Hoax by Anti-Coal Group

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SYDNEY--More than 300 million Australian dollars (US$314 million) was wiped off the value of Whitehaven Coal Ltd. (WHC.AU) shares at one stage on Monday, after the Australian mining company fell victim to a hoax email apparently from an environmentalist group.

Whitehaven said the email was a fake media release purportedly from Australia & New Zealand Banking Group Ltd. (ANZ.AU) which claimed the lender had withdrawn a A$1.2 billion loan previously offered to help fund its Maules Creek mine in New South Wales state.

A group calling itself Front Line Action on Coal claimed responsibility for the email, which drove the company's shares down by as much as 9% in Sydney before Whitehaven went into trading halt. The shares recovered most of their losses after trading resumed following Whitehaven's statement.

The episode highlights the simmering tension between mining companies seeking to unlock deposits of raw materials in Australia that can be shipped to fast-growing economies in Asia and elsewhere, and other land users and environmental groups opposed to new resources developments.

In a separate statement, ANZ also confirmed that the release was part of a hoax, and said it remained "fully supportive" of Whitehaven, one of Australia's largest-listed coal producers with a market value of A$3.5 billion.

Whitehaven announced last month that it had received the ANZ loan, which replaced its existing bank facilities. It said the loan would be used to finance Maules Creek.

In a statement, the Australian Securities and Investments Commission, or ASIC, said it was aware of the hoax press release and was looking into the matter.

"ASIC's initial enquires will focus on if there has been a breach of the Corporations Act. If there appears to be a breach, ASIC will investigate and take timely and appropriate action," it said.

"Our primary concern is the expansion of the world's most unsustainable industry," said Jonathan Moylan, a spokesman for Front Line Action on Coal, an activist group. "Bank customers deserve to know where their money is going, and while we have been going through the formal processes the government is no longer listening."

It is the third time in six months that major Australian companies have been targeted by scams.

David Jones Ltd. (DJS.AU) disclosed a A$1.65 billion takeover approach by a mysterious U.K. entity in June, which sent shares in the department store chain up as much as 18% before the offer was quickly withdrawn. A regulatory investigation by ASIC into disclosure and trading in David Jones stock followed.

In October, engineering contractor Macmahon Holdings Ltd. (MAH.AU) halted trading its shares after being contacted by the media over a fabricated email exchange among Macmahon board members about a Chinese takeover approach.

Write to Rhiannon Hoyle at rhiannon.hoyle@wsj.com

Subscribe to WSJ: http://online.wsj.com?mod=djnwires

(END) Dow Jones Newswires

January 07, 2013 15:35 ET (20:35 GMT)

Copyright (c) 2013 Dow Jones & Company, Inc.

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