Nathan Tinkler has sold around half his stake in Whitehaven Coal for $300 million, a move that has seen him lose his place as the largest shareholder in the company.
The former billionaire sold his 9.9 per cent stake to investor firm Farallon Funds for $2.96 a share.
The sale cuts Tinkler’s stake in Whitehaven to less than 10 per cent, SMH reported.
Analysts say the sale is good news for the company.
'I think Tinkler has been unstable presence on the register. Reducing his holdings in an orderly manner is important,'' Wilson HTM senior resources analyst Andrew Pedler said.
''It will not affect the operations of the company whatsoever. It will affect people's perceptions of its value.''
Farallon said it "believes the current market price of Whitehaven shares does not reflect the value of the company".
"The Farallon Funds now have a sizeable investment in Whitehaven, and Farallon looks forward to growth in shareholder value over time."
Tinkler said the decision to sell the share had been "difficult" but that the sale was in the best interests of shareholders.
"While we are happy with the price we have received, being a 40 per cent premium to the current market price and a recent high for the company, we feel strongly that this still significantly undervalues the company's underlying asset base," he said in a statement.
Whitehaven also welcomed the sale.
“Whitehaven has a strong existing relationship with Farallon and we welcome its further investment in our business,” Whitehaven managing director Paul Flynn said.
“We look forward to continuing to deliver on our growth plans and to creating value for all our shareholders.”
Farallon announced plans to buy another 1.63 per cent. It currently holds a 5.1 per cent stake in the company.
Whitehaven shares jumped 9 per cent to $2.30 in early trade.