Mumbai: Lanco Infratech Ltd is considering a bid for Australia’s Premier Coal, owned by coal-to-retail conglomerate Wesfarmers, a top executive said, joining the race of Indian firms scouting for coal assets across the world.
“We are evaluating it,” Lanco Group chief financial officer J. Suresh Kumar told Reuters on Monday. “We have not yet started due diligence.”
Wesfarmers is looking to sell the Premier Coal mine in the western part of Australia, whose value is estimated by analysts at $400 million-plus, The Australian newspaper has reported.
“They (Wesfarmers) are following a transparent process. We are participating in that process, and maybe in the next two-three months there would be clarity on it,” Kumar said.
Indian energy major Reliance Industries, utility Reliance Power and construction and energy firm GVK Power are also in the race to buy Premier Coal, media reports have said.
In December, Lanco had acquired Australia’s Griffin Coal mines for A$750 million ($760 million).
Race for coal
Indian companies are looking to secure overseas coal supplies to fuel power plants in India, which aims to halve its nearly 14% peak-hour power deficit within two years.
Aditya Birla Group, JSW Steel and Jindal Steel & Power are shortlisted bidders for another Australian coal explorer Bandanna Energy in a potential billion-dollar-plus sale.
Last August, conglomerate Adani Enterprises had bought Australian Linc Energy’s Galilee coal project in a cash and royalty deal worth $2.7 billion.
India’s demand for coal is forecast to grow 11% a year, while imports for 2011-12 are likely to touch 135 million tonnes, according to the coal minister.
At 02:20 pm, shares in Lanco, valued by the market at $1.8 billion, were trading down almost 3% at Rs32.90 in a steady Mumbai market.