GVK acquires majority stake in Australia's Hancock Coal for $1.26 billion
17 September 2011
In the second-largest Indian acquisition in Australia's mining sector after Adani Group's investment in a Queensland coal block, Hyderabad-based GVK Power & Infrastructure Ltd, part of the GVK Group, yesterday acquired majority assets of Australia's heiress Gina Rinehart-owned Hancock Coal for $1.26 billion (Rs5,983.74 crore).
In August 2010, Adani Enterprises acquired a 100-per cent stake in the Galilee Basin coal block in Queensland from Australia's Linc Energy, for around $2.68 billion (Rs12,600 crore). (See: Adani bags $2.7-billion deal to acquire Australian coal mine)
Earlier in March 2011, another Hyderabad-based infrastructure major, Lanco Infratech, acquired Australia's Griffin Coal for A$750 million (See: Lanco acquires Griffin's Australian coal assets for $750 million).
GVK will invest an additional $10 billion (Rs47,490 crore) to develop the assets of Hancock Coal, which would make it the largest investment by an Indian company in Australia.The GVK-Hancock deal includes the Hyderabad company acquiring a majority stake in Hancock coal mines, railway line and port infrastructure projects and an option to buy 20 million tonnes of coal annually under a long-term supply contract.
The acquisition will be made through GVK Coal Developers, Singapore Pte Ltd, an indirectly-owned subsidiary of GVK Natural Resources Pte Ltd, a GVK Group joint venture with GVK Power and Infrastructure Limited.
Initially GVK Natural Resources will hold a 90-per cent stake and GVK Power the remaining 10 per cent in the projects.