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  • Date of publication: 31 August 2020
  • 3434
  • businessbuysale.com
  • Glencore buys coal assets of Rio Tinto in Australia for $ 1.7 billion

    Synopsis

    Glencore Plc buys Rio Tinto's coal assets in Australia - a 82% stake in Hail Creek and a 71.2% stake in Valeria for $ 1.7 billion.

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Description

Glencore Plc buys Rio Tinto's coal assets in Australia - a 82% stake in Hail Creek and a 71.2% stake in Valeria for $ 1.7 billion.

 

The remaining 18% of Hail Creek belongs to Nippon Steel Australia (8%), Marubeni Coal (6.67%) and Sumisho Coal Development (3.33%), and each of these companies has the right to sell its share of Glencore on terms similar to the deal with Rio Tinto.

In the event that companies take advantage of this right, Glencore can spend up to $ 340 million on the purchase of these assets, according to a Glencore press release. The Hail Creek coal deposit is located 120 kilometers south-west of the Australian city of McKay in Queensland.

In 2017, the field produced about 9.4 million tons of coal exported. Reserves of the Valeria coal deposit are estimated at 762 million tons. The deal requires the approval of regulators and is expected to be completed in the second half of 2018, noted Glencore.

Swiss Glencore is actively expanding its presence on the Australian coal market, with which many are eager to leave. Last year, the company bought a 49% stake in the Hunter Valley coal mine in China's Yancoal. Hail Creek is one of the last coal assets of Rio Tinto, whose management seeks to focus its operations on key assets - iron ore and copper.

The Rio Tinto coal mine Kestrel, also located in the Australian state of Queensland, is currently for sale. Glencore is already a major coal producer in Australia. Last year, coal production at 17 fields owned by the company amounted to over 87 million tons.

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