Millner dives into New Hope but the heady days of coal may soon be over
Directors are diving in to lift their stakes in some of Queensland’s biggest companies including billionaire and New Hope chairman Robert Millner, who has spent another $1.8 million to lift his direct and indirect stake in the coal producer.
Coal is likely to play a key role in the upcoming election
Directors are restricted to when they can buy and sell shares and Millner waited until after New Hope reported its almost $1 billion annual profit to buy, but the off-market deals didn’t come cheaply.
And if analysts are right the record-breaking days of coal are likely to be short.
Millner’s shares, held indirectly through holding companies cost up to $6.32 a share and New Hope is hovering just below $6 today. Millner has a direct and indirect stake of 5.5 million shares in New Hope.
New Hope has been enjoying a rare moment of sunshine after spending two years sitting below $2 a share. However, the heady days may be coming to an end.
Global research company Wood Mackenzie said the resurgence in coal prices, which have shot to $US430 a tonne in Newcastle, were likely to be short-lived.
“And we do not see companies making major investments to increase (coal) infrastructure or long-term production,” analyst Adam Woods said.
He said massive stockpiling had been done in case of a global electricity shortage. As much as half of the extra 9 gigawatts of additional coal capacity being made available was being held back from the market.
“Long-term, global thermal coal demand will continue to recede. Conversely, this recent bump in coal may speed up the change to renewables in Europe as this current crisis has highlighted the need for energy security and independence,” he said.
“We expect higher European coal-fired generation to last until the middle of this decade. However, imported higher quality coal generation will be phased out completely by the end of the decade, although lower quality lignite generation could extend much further.
“The higher energy price outlook and support security concerns make renewables more attractive.”
Wood Mackenzie anticipates 50 gigawatts of solar and wind energy in Europe by 2030.
Other directors have also swooped in. Suncorp director Doug McTaggert picked up 699 shares in the banking and insurance company at $10.88 each taking his stake to $444,000. Fellow Suncorp director Ian Hammond snapped up a similar amount while Sylvia Falzon snapped up a smaller amount.
Investors see director activity as a sign of confidence in the company.
