European steelmaker ArcelorMittal has pulled out of its joint deal to takeover Macarthur Coal with US-based Peabody Energy.

The deal will continue but with ArcelorMittal to sell its interest to Peabody, giving the US energy giant total control of the Queensland coal miner.

Separately, Macarthur announced that Julian Thornton, current managing director of Peabody Energy Australia, had been appointed chief executive of the Queensland-based coal miner.

He would also be one of the directors on the new Macarthur board.

Peabody Energy and ArcelorMittal’s joint venture bid vehicle PEAMCoal took a majority stake in Macarthur Coal earlier this week, after launching a $4.9 billion takeover bid.

ArcelorMittal said the deal required it to invest too much capital in a business it wouldn’t fully control.

“Given the unanticipated level of acceptances into the offer, ArcelorMittal believes that it is more appropriate to focus its capital elsewhere in its business,” it said in a statement.

Peabody chairman and chief executive Gregory Boyce said that while his company expected a partnership with ArcelorMittal, “we have always preferred a larger ownership”.

He said going it alone would speed up Peabody’s ability to cut costs and benefit from the acquisition.

Peabody said it was getting a new loan of up to $US1 billion ($A962 million) and would use cash and borrowing to pay for Macarthur.

PEAMCoal had offered $16 per Macarthur share, which would increase to $16.25 if a 90 per cent stake in Macarthur was achieved by November 11.

The directors of Macarthur Coal have recommended all remaining shareholders accept the PEAMCoal Offer without delay.

Also on Wednesday, Macarthur said that it had named a new board of directors, following the takeover.

Eric Ford, Peabody Energy executive vice president, would become the new chairman.

Overnight, Macarthur said that sales for the three months to September came to 991,400 tonnes, down 21.7 per cent on a year earlier.

Saleable coal production for the quarter was 850,000, down 34.8 per cent on the prior corresponding period.