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BlueScope waives Illawarra pre-emptive rights

28th May 2024

By: Creamer Media Reporter

     

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The sale of the Illawarra metallurgical business to an entity owned by Singapore’s Golden Energy and Resources (GEAR) and coal trader M Resources remains on track to be completed in the first half of the 2025 financial year, reported miner South32 on Tuesday.

Australian steelmaker BlueScope has waived its pre-emptive right to the assets under its long-term coal supply agreement (CSA) and offered its support for the transaction.

Illawarra supplies BlueScope’s Port Kembla steelworks with a blend of metallurgical coal from its Appin and Dendrobium mines.

"BlueScope has had strong engagement with GEAR and M Resources and looks forward to working with them as the new owners of Illawarra and as a long-term supplier to the Port Kembla steelworks," said BlueScope.

The company added that GEAR and M Resources had agreed to a number of improvements to the CSA, including a one-year extension of the contract to now expire in 2033, along with the commitment to undertake a detailed review process to support a potential extension of the supply of the Illawarra coal blend under the CSA beyond 2033

The Illawarra deal, which will see South32 exit coal, comprises a cash payment of $1.05-billion at completion and a deferred cash consideration of $50-million payable in 2030.

It is set to be completed in the first half of fiscal 2025, subject to conditions such as approval by the Foreign Investment Review Board.

Edited by Creamer Media Reporter

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