Why is the Yancoal share price surging 6% on Friday?

The Yancoal Australia Ltd (ASX: YAL) share price is pushing higher into the green on Friday after a good start to the day.

At the time of writing, the Yancoal share price is up 6% at $6.94 following a company announcement. Shares earlier touched $7.15 — their highest mark in 12 months.

What’s up with the Yancoal share price?

The company posted a price-sensitive update informing investors that Yankuang Energy had terminated a potential deal to buy the remaining shares it didn’t already own in Yancoal.

Yankuang already holds a 62.3% stake in the coal player. The offer it made was made based on historical performance of the Yancoal share price.

“Yankuang Energy wishes to update the respective shareholders and potential investors…that, in light of the recent market conditions, it will terminate the potential transactions,” the Chinese company said in a statement.

Following the decision, it was stated that no person or entity, including Yangkuan, can announce an offer or possible offer for Yancoal within six months of today’s announcement.

Investors don’t appear concerned and have, in fact, rewarded Yancoal on the back of the news.

Shares jumped like a mare from the gates at Randwick in early trade today and have held the line since. Trading volume is within 95% of the four-week trading average at nearly 3 million shares.

Today’s lift extends an impressive run for Yancoal these past 12 months, bringing its gains to 186% during that time.

The company hasn’t looked like slowing down either, as seen in the chart above, and neither has the price of coal.

The price of the black rock just recently shot to 52-week highs itself and has turned sharply to trade at US$440/Tonne, just off its all-time high of US$460/Tonne yesterday.

The post Why is the Yancoal share price surging 6% on Friday? appeared first on The Motley Fool Australia.

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More reading

• 2 ASX All Ordinaries shares that defied today’s sell-off to crack new highs
• Why has this ASX energy share surged 196% since the start of the week
• Why are ASX 200 coal shares having another cracker of a day?
• Yancoal share price lifts on 677% earnings boost
• Why India can’t get enough of Aussie coking coal and which ASX shares have exposure

Motley Fool contributor Zach Bristow has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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