Essar drops $134mn bid for Aussie miner

Essar Steel has dropped out of the bidding battle for Australian coalminer Rocklands Richfield, leaving compatriot Jindal Steel & Power (JSPL) in the fray as the sole suitor.

“The Company has now been notified in writing by Essar that it no longer wishes to proceed with its proposal and that accordingly the Essar proposal is formally withdrawn,” Rocklands told the Australian Stock Exchange.

The reason for the Essar move is not known. The company had not responded to an email from DNA Money at the time of this article going to the press.

Rocklands said it had written to Essar asking why it was dropping the A$144 million ($134 million) bid, and to determine whether it would like to continue the takeover on amended terms.

Essar, in its reply to Rocklands, said it would respond to the queries after discussing the matter internally next week as the Essar personnel were on vacation on account of Diwali. Under the terms, if any of the two steelmakers pulled out of the race after getting the approval to conduct due diligence, it would have to pay A$1.5 million as breakaway fee.