Glencore To Acquire Optimum Coal
Mining and commodities trader Glencore International plc has announced plans to acquire a controlling interest in Optimum Coal Holdings Limited, one of the largest producers of thermal coal in South Africa.
Glencore said in a company announcement that it plans to acquire Optimum coal through a consortium with its local Black Economic Empowerment partner, prominent South African businessman Cyril Ramaphosa.
“Optimum’s high quality, long life coal assets and significant presence at Richards Bay Coal Terminal would be an attractive addition to our existing South African coal business," Tor Peterson, director of the Coal/Coke commodity department said.
He said Glencore expect a strong demand for coal from China and India and concerns surrounding nuclear generation capacity will result to a sustained demand for coal.
"This transaction would further demonstrate Glencore’s ability to identify attractive opportunities, capitalise on its strong local relationships and execute complex transactions,” he said.
The Australian reports that the Glencore consortium values Optimum up to $1.1 billion ($US1.2 billion).
The transaction, if successfully implemented, will result in a consortium comprising Piruto B.V., a wholly owned subsidiary of Glencore International AG, and Lexshell 849 Investments (Proprietary) Limited, a company wholly-owned by Mr Cyril Ramaphosa, Glencore's local Black Economic Empowerment partner, acquiring the entire issued ordinary share capital of Optimum other than the shares of certain shareholders who are restricted from selling.
"The proposed transaction will include a general offer to the shareholders of Optimum for cash," it said.
The transaction is seen to complement Glencore’s existing coal operations in South Africa with Shanduka Coal and gives Glencore access to Optimum's attractive growth projects such as the recently acquired TNC and Remhoogte projects.
Glencore currently owns 14.1% of Optimum’s issued share capital. Glencore is one of the world’s leading integrated producers and marketers of commodities. Its sharesa are listed on the London and Hong Kong Stock Exchanges.
Optimum Coal, meanwhile, is a black-owned and controlled South African mining group and is one of South Africa’s largest coal mining companies with extensive operations located in the Witbank coalfield region of Mpumalanga.