Twitter
Advertisement

AV Birla, Coal India eye Rio Tinto assets

Latest News
article-main
FacebookTwitterWhatsappLinkedin

Coal India and Aditya Birla group are among a host of global companies that have shown interest in the assets put on the block by Rio Tinto in Australia.

The Anglo-Australian mining giant is selling a 29% stake in its subsidiary Coal & Allied in the New South Wales province and its majority stake in the Clermont mine in Queensland, among other assets.

Coal and Allied Industries, managed by Rio Tinto Coal Australia, operates three open cast mines at Bengalla, Hunter Valley Operations and Mount Thorley Warkworth, while Rio Tinto Australia directly controls mines like Clermont, Hail Creek and Kestrel in Queensland. The group has reportedly hired Deutsche Bank to find buyers for stakes in these mines as it is unable to operate them economically.

Sources in Coal India said the company’s foreign acquisition committee considered around four proposals on Tuesday, all from Australia. They, however, did not reveal the names.

“We have signed non-disclosure agreements with the foreign parties and hence, the names are being kept confidential,” said one of the officials.

Kumar Mangalam Birla-run Aditya Birla Group is another entity that has shown interest in Rio Tinto’s assets. The group’s outfits like aluminium maker Hindalco and cement maker UltraTech Cement need coal as fuel and Birla has been eyeing overseas coal assets, including Australia’s New Hope Corp.

Indeed, Coal India also needs imported coal to bridge the shortfall in domestic production in meeting the 80% of annual contracted quantity as per the Fuel Supply Agreements it has entered into with power and non-power consumers. Its chairman Narsing Rao has indicated that the company might have to import close to 5-6 million tonne of coal this fiscal.

After periods of extreme volatility, coal prices are showing relative stability, a factor that could help India’s pubic sector companies achieve success in bidding for foreign mining assets, C S Verma, chairman of SAIL and International Coal Ventures, a consortium of public sector units to acquire overseas coal assets, said recently.

This has also ignited interest of global private equity players like Blackstone, which is currently eyeing Rio Tinto’s iron ore assets.

Find your daily dose of news & explainers in your WhatsApp. Stay updated, Stay informed-  Follow DNA on WhatsApp.
Advertisement

Live tv

Advertisement
Advertisement