New Delhi: Adani group has started talks with Coal India Ltd (CIL) to take on board the state-owned company as a partner for developing the Australian mines that it recently bought in a Rs12,600 crore deal.
“Talks have opened up between an Adani group firm and Coal India Ltd. Adani group is seeking to rope in CIL for development of coal assets it recently bought in Australia for Rs12,600 crore. There could be an equity partnership as well,” a market source privy to the development told PTI.
Neither Adani group nor CIL could be reached for comments.
Another industry source said that the talks are at a very initial stage and any decision could only be taken after the completion of the CIL’s mega IPO which is to commence on 18 October, and end on 21 October.
Of late, Adani enterprises - the country’s largest coal importer - has been very aggressive on its overseas acquisition programmes.
CIL, the world’s largest coal producer, has also outlined over Rs5,000 crore for foreign acquisitions this fiscal.
In August, in one of the largest coal mine deals by an Indian group, the Adani Enterprises bought the Australia-based Linc Energy’s Galilee coal tenement in the Queensland for about Rs12,600 crore in a cash and royalty deal.
As part of the buyout deal, the group had paid Rs2,100 crore in cash and is to make additional payment of about Rs 10,500 crore over next 20 years in royalties to Linc on the 7.8 billion tonnes coal reserves.
It had also been awarded preferred proponent status for developing the Dudgeon point terminal in Macay, Queensland, which gives the Adani Group the right to develop a coal terminal with an annual capacity of 30-60 million tonnes.
In its efforts to secure more coal deposits overseas, Adani Enterprises also entered into a $1.65 billion deal with the Indonesian government and its mining company PT Bukit Asam for setting up rail and port infrastructure in the island nation and get exclusive rights to source coal to India.
Meanwhile, taking forward its global ambitions, CIL has shortlisted US firms Massey Energy and Peabody Energy, besides Indonesian Novem/Sinarma, for a possible partnership for their respective mines in Australia, Indonesia and the United States. In another arrangement, CIL shortlisted Peabody Energy and 11 others as possible partners for sourcing coal to India.
Coal India, which has domestic market share of over 80 %, has maintained that it is sitting on a cash reserve of over Rs30,000 crore to part-fund its growth projects and the proceeds of the IPO will go to the government.
The IPO is expected to generate over Rs15,000 crore, which will be the biggest ever share sale in India so far.