SCCL calls for EOI for Acquisition of Overseas Thermal Coal Assets

SCCL, a joint venture between the Central Government and Telangana state, is making a move to enter into overseas Coal mines acquisition. Interested participants can submit their quotations on or before 10 Jun’15.

The company is interested in acquiring Coal mines, with annual production capacities of around 2 MnT, in Australia, South Africa, Indonesia and Mozambique in order to remain the solitary coal producing company in the state. It is SCCL’s responsibility to provide Coal to all the sectors like Power, Cement, Steel and any other projects in the newly created state named Telangana.

“SCCL intends to secure its Thermal coal requirement by acquiring Coal assets abroad by acquiring equity stakes in Coal mining companies in Australia, Indonesia, South Africa and Mozambique by way of joint ventures,” as quoted in a global expression of interest (EOI) released on Thursday.

[su_quote]Mr. N Sridhar, Chairman and Managing Director of SCCL shared his idea regarding this acquisition. According to him, due to fall in global Coal prices, it is the right time to look forward to overseas acquisition of Coal assets at lower prices.[/su_quote]

The company will show positive interest in quotations offering minimum 51% ownership of Coal assets to SCCL. After receiving the quotations for EOI by June, the company is likely to conduct due diligence study on the short listed offers by engaging independent specialist consultants.

Specifications of Coal Assets

Source: SteelMint Research

SCCL’s Coal Production

SCCL is the country’s only Coal mining company operating 16 opencast and 32 underground mines in 4 districts of Telangana which has a reserve of 8,791 MnT Coal.
The total production of Coal by SCCL in FY15 is estimated to be 52.5 MnT which is a 4% increase as compared to 50.4 MnT in FY14.