Kolkata-headquartered Indian state-controlled coal mining company Coal India Limited (CIL) has aborted plans to acquire coking coal assets in Australia, a company official said on Wednesday, February 28.
The official said that CIL had last year identified a coking coal mine in Queensland, Australia, and had been getting ready to appoint an advisor to acquire the asset, but, despite several requests to gain access to the mine to conduct due diligence, there was no response from the asset owner.
CIL had given the go-ahead for the acquisition of a stake in the range of 20-25 percent in the Queensland mine and funds for the acquisition were approved, but, in the absence of any response from the majority equity holder in the mine, CIL has decided not to pursue the acquisition any longer.
CIL did not have any definite indication regarding the lack of response from the asset owner, but sources said that, with the reversal of the falling trend in international coking coal prices, most coking coal mine owners are either delaying sales plans or are looking at higher valuations for the assets in the event of partial disinvestment.
CIL’s wholly-owned subsidiary Bharat Coking Coal Company Limited is the sole domestic supplier of coking coal to Indian steel mills, accounting for about 37 million mt of supplies per year.