MELBOURNE (Reuters) - Rio Tinto (ASX:RIO) (LSE:RIO) has agreed to sell its majority stake in the Clermont coal mine in Australia to Glencore Xstrata (LSE:GLEN), The Australian reported on Friday.
Glencore Xstrata and Rio Tinto declined to comment on the report.
Rio Tinto put its 50.1 percent stake in the Clermont coal mine up for sale earlier this year along with a minority stake in its Coal & Allied joint venture, which analysts estimated could together fetch $3.2 billion (2 billion pounds).
Rio's co-owners in the Clermont mine in Queensland are Mitsubishi Corp , Japan's Electric Power Development Co Ltd (TYO:9513) and a consortium of Japanese power companies.
China's state-owned Shenhua Group Corp Ltd and India's Aditya Birla Group were among companies that looked at the coal assets, but sources said those parties had dropped out of the running.
Dutch trader Trafigura and India's Adani Enterprises Ltd (NSI:ADANIENT) had put in bids below $850 million for the Clermont stake, the Wall Street Journal reported earlier this month.
There has also been talk that Glencore and Rio Tinto are discussing a possible joint venture of their coal assets in Australia to help cut costs and shore up margins with thermal coal prices holding close to four-year lows.
Glencore is the top thermal coal exporter in Australia, while Rio Tinto is the largest thermal coal producer in Australia's Hunter Valley.
Bankers and analysts had predicted Rio would have a tough time selling the assets given a poor outlook for thermal coal prices and high costs in Australia.
(Reporting by Sonali Paul; Editing by Muralikumar Anantharaman)
- Mergers, Acquisitions & Takeovers
- Commodity Markets
- Glencore Xstrata