Is NMDC interested in Australia’s Riversdale?

Is NMDC interested in Australia’s Riversdale?

Kolkata: State-owned mining firm NMDC Ltd’s chairman and managing director said on Wednesday that his company is looking to buy 10% of Australia’s Riversdale Mining Ltd, but later in the day denied this was happening in an interview to Bloomberg.

Tata Steel Ltd and CSN Group of Brazil have significant stakes in the Australian company.

NMDC chairman and managing director Rana Som said his company had initiated talks to acquire a minority stake in the firm, which according to the Australian media is a potential takeover target. Som declined to provide any further details claiming these could result in an increase in its acquisition price. Later, he told Bloomberg that his company was interested in assets in Mozambique, not a stake in Riversdale.

The 10% stake could cost NMDC around A$223 million (Rs950 crore) at the current Riversdale market price.

NMDC’s shares fell 0.94% to Rs259 on the Bombay Stock Exchange, while the bourse’s benchmark Sensex index closed 21.65 points higher at 18,666.71.

A Riversdale spokesperson said he had nothing to add over and above disclosures made to ASX.

A spokesperson for Tata Steel declined to comment. Through its indirect subsidiary Tata Steel Global Minerals Holdings Pte Ltd, Tata Steel owns a 24.21% stake in Riversdale. Brazilian steel maker CSN currently owns a 16.29% stake in Riversdale.

If NMDC joins Tata Steel as a key stakeholder in Riversdale, they would together have better control of the firm’s assets, said Anjani K. Agarwal, partner at consulting firm Ernst and Young. Riversdale’s key coal mining assets are in Mozambique and South Africa.

Bloomberg contributed to this story.