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Rio Tinto (LSE:RIO) is selling two small coal assets in South Africa to Canadian firm Forbes & Manahattan Coal (TSX:FMC, JSE:FMC) for $53 million in an effort to shed its smaller operations. Forbes Coal said in a statement that it will acquire a 74 percent interest in the Zululand Anthracite Colliery, which produced anthracite, and another …
Rio Tinto (LSE:RIO) is selling two small coal assets in South Africa to Canadian firm Forbes & Manahattan Coal (TSX:FMC, JSE:FMC) for $53 million in an effort to shed its smaller operations.
Forbes Coal said in a statement that it will acquire a 74 percent interest in the Zululand Anthracite Colliery, which produced anthracite, and another 74 percent stake in the Riversdale Anthracite Colliery, an undeveloped mine. The remaining 26 percent stakes in the properties, located in the Kwa-Zulu Natal province, are owned by black economic empowerment partners.
The acquisition is expected to boost Forbes’ total production by 39 percent to 2.5 million tonnes a year. The company’s stock is up 6.15% today in mid-day trading.
Rio Tinto has also been scaling back its Australian coal operations as it struggles with low coal prices and a high Australian dollar.
The Anglo-Australian miner earlier this month announced job cuts across its coal mines in Queensland, and yesterday said it is reducing the workforce at its Australian Coal & Allied Industries unit.