Yancoal increases Warkworth stake for $US230m

Yancoal Australia has exercised a call option to purchase Mitsubishi’s 28.9 per cent interest in the Warkworth coal joint venture in the Hunter Valley for $US230 million ($291.7 million).

The acquisition is expected to be complete by March 2018. It is subject to Foreign Investment Review Board (FIRB) approval and the waiver of existing pre-emptive rights held by the other minority Warkworth JV partners.

Yancoal will own around 84.5 per cent of the Warkworth JV at completion of the transaction.

The deal will increase Yancoal’s share of coal production from the integrated Mount Thorley Warkworth (MTW) operations from 64.1 per cent to 82.9 per cent. Total saleable coal production at MTW in 2016 was 12.3 million tonnes.

Yancoal chief executive officer Reinhold Schmidt commented: “By exercising the call option, we are strengthening our position within the Hunter Valley and progressing our long-term strategy for continued growth and investment into Tier 1 assets.”

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