Rio Tinto’s last two coal mines set to attract bids over $2.5 billion – by Sonali Paul and Clara Denina (Reuters U.S. – March 9, 2018)

https://www.reuters.com/

MELBOURNE/LONDON (Reuters) – At least three bidders are expected to submit final offers for global miner Rio Tinto’s (RIO.AX)(RIO.L) Hail Creek and Kestrel coal mines in Australia, which could fetch up to $2.5 billion, people familiar with the process said.

The Anglo-Australian mining company made a strategic decision in 2017 to exit coal and focus on growth in iron ore, copper and its aluminum division. Hail Creek and Kestrel are Rio Tinto’s last two coal mines, following the $2.7 billion sale of its Hunter Valley coal operations in Australia to Yancoal last year.

Australia’s Whitehaven Coal (WHC.AX) is expected to bid, as well as Australian private equity firm EMR Capital along with Indonesia’s Adaro Energy (ADRO.JK). A consortium led by U.S. private equity firm Apollo Global Management (APO.N) is also expected to be in the running.

Final bids for the two mines that mostly produce coking coal, used in steel mills, are due on Monday, March 12. All sources declined to be named as the bids were subject to confidentiality agreements.

The sale is eagerly awaited by investors, who are hungry for more cash returns after a bumper payout for 2017, as the company is no longer looking to cut debt and has no plans for any big new investments.

For the rest of this article: https://www.reuters.com/article/us-rio-tinto-coal-divestiture/rio-tintos-last-two-coal-mines-set-to-attract-bids-over-2-5-billion-idUSKCN1GL1OD

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