Yancoal buys further stake in Warkworth coal mine for $230m
PERTH (miningweekly.com) – ASX-listed Yancoal Australia has exercised a call option to purchase Mitsubishi Development’s 28.9% interest in the Warkworth coal joint venture (JV) for $230-million.
The deal followed Yancoal’s $2.69-billion acquisition of mining major Rio Tinto’s Coal & Allied subsidiary, which included a 67.6% stake in the Hunter Valley Operations mine, an 80% stake in the Mount Thorley mine and a 55.6% stake in the Warkworth mine, as well as a 36.5% interest in Port Waratah Coal Services, which owns a coal export terminal at the Port of Newcastle.
Mitsubishi in June accepted the Chinese firm’s offer for its 32.4% interest in the Hunter Valley operations JV for $710-million, and provided Yancoal with call options over its interest in the Warkworth mine.
“By exercising the call option, we are strengthening our position within the Hunter Valley and progressing our long-term strategy for continued growth and investment into tier one assets,” said Yancoal Australia CEO Reinhold Schmidt.
At completion of the transaction, Yancoal would hold 84.5% of the Warkworth JV, which will increase the company’s coal production from the integrated Mount Thorley Warkworth operations from 64.1% to 82.9%.
The operation’s total saleable coal production in 2016 was 12.3-million tonnes.
The acquisition of Mitsubishi’s Warkworth interest was subject to Foreign Investment Review Board approval, and the waiver of existing pre-emptive rights held by the other minority JV partner.
The deal is likely to be completed by March 2018.
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