Glencore announces $1.7bn Rio Tinto coal mine deal
Date: Mar 21, 2018
Switzerland-headquartered mining major Glencore will acquire diversified miner Rio Tinto’s 82% interest in the Hail Creek coal mine and adjacent coal resources, in Queensland, as well as a 71.2% interest in the Valeria coal resource for $1.7-billion in cash, the company announced on Tuesday.
Nippon Steel Australia, Marubeni Coal and Sumisho Coal Development own the remaining 18% of the Hail Creek mine and each joint venture partner has the right to sell its share to Glencore through a “tag-along” right, which could result in additional consideration of up to $340-million.
The transaction, which is subject to regulatory approvals and is expected to close in the second half of 2018, follows on Glenore’s acquisition of a 49% stake Rio Tinto’s Hunter Valley mines last year, through a deal with Yancoal.
Rio Tinto has made a strategic decision to exit coal and focus on growth in iron-ore, copper and. The company’s final coal asset is the Kestrel mine, which is subject to a separate sales process.