MELBOURNE, June 7 (Reuters Breakingviews) - Even the best-planned deals can be overtaken by events. Yankuang Energy’s (600188.SS) bid to buy the 38% of Yancoal Australia (YAL.AX) it doesn’t own is floundering of its own accord. It’s a dud to begin with: The Chinese coalminer wants to pay with a bond convertible into its own stock at a discount to Yancoal’s undisturbed closing price, and it may not be able to get Australian government approval anyway. Yancoal’s three independent board members would not have worked up a sweat rejecting it. Shareholder Glencore (GLEN.L) has already turned up its nose.

The buyer confirmed on Tuesday that it will continue discussions. It’s using Yancoal’s historical average prices to argue it is offering a premium. Trouble is, the target’s stock jumped around 50% in early March two months before the bid. Update the trailing averages to the most recent close instead of Yankuang’s chosen date of May 25, and it would need to raise its offer by at least 8% to abide by its premium calculations. That’s regardless of the undisturbed price: The offer was so noxious Yancoal’s stock has actually fallen since. Time, for now at least, is not on Yankuang’s side. (By Antony Currie)

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(The author is a Reuters Breakingviews columnist. The opinions expressed are their own.)

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