The company is undertaking a fully underwritten global offering, priced at HK$23.48-25.84, equating to A$4.09-4.50, a significant premium to Friday's closing price of $3.06.
Yancoal expects to announce the final pricing on Friday.
Morgan Stanley, CMB International, BOC International and Citi are joint global coordinators, bookrunners and lead managers.
Shaanxi Coal and Chemical Industry Group Co has agreed to cornerstone the global offer with a US$40 million investment.
Assuming the offer is successful, Yancoal will launch an Australian pro-rata accelerated renounceable entitlement offer on Friday.
Eligible shareholders will be able to subscribe for 0.053 shares for every one share held at the same price as the global offer.
The offer will include institutional and retail components and raise A$34-37.6 million.
Yancoal said the funds would be used to repay debt, to finance potential acquisitions, to fund the acquisition of an additional 4% in the Moolarben joint venture, and for working capital.
The company has net debt of $3.9 billion.
Yancoal expects to produce 34 million tonnes of coal this year, up from 19.3Mt last year.
The growth is driven by its transformational acquisition of Coal & Allied from Rio Tinto, and the Moolarben stage two expansion.