Noble Group: Gloucester Coal Ltd Proposed Merger with Yanzhou Coal.

Gloucester Coal Ltd (Gloucester) has entered into a merger proposal deed (Merger Proposal Deed) with Yanzhou Coal Mining Company Limited (Yanzhou) and its wholly owned Australian subsidiary, Yancoal Australia Limited (Yancoal), following an approach from Yanzhou.

Noble's intentions
Noble Group Limited (Noble) has stated to Gloucester's independent directors that, subject to approval by the Noble board of directors and in the absence of a superior proposal, Noble intends to vote its shareholding in favour of the merger proposal and would elect to receive all ordinary shares as scheme consideration (that is, the option not including any CVR shares). Noble currently controls 64.5% of the ordinary shares in Gloucester.

Links:
http://info.sgx.com/webcoranncatth.nsf/VwAttachments/Att_011F582FA95A04BE4825796E007C5D65/$file/1063683.pdf?openelement

http://info.sgx.com/webcoranncatth.nsf/VwAttachments/Att_8E37421C127112E94825796E00561CA4/$file/PressRelease_ProposedMerger.pdf?openelement

Summary:
Noble has said that this merger is part of their long term plan, and that it is beneficial to shareholders of Glouchester and Noble Group. Being a major shareholder of Glouchester, Noble has stated that they will vote FOR the merger to go through.


Chart Analysis:
Based on the chart, Noble is currently facing stiff resistance at $1.25 level. The broken down gap between $1.28 to $1.60 doesn't look to be covered anytime soon as there're alot of previous support levels being broken by the gap down. The various levels are stated in the chart, and Noble would need alot of BULLS to overcome those levels.

Support for Noble currently holds at $1.10, followed by $1.05. A breakdown below $1.05 would send the stock tumbling down tremendously.