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Anglo-Australian resources giant Rio Tinto has agreed to sell its majority holding in a coal mine in northeastern Australia for almost $2.3 billion to private equity manager EMR and Indonesian coal group Adaro.
The huge divestment, equivalent to 1.8 billion euros, is part of the company’s strategy of strengthening its portfolio and focusing on high returns.
‘Rio Tinto has entered into a binding agreement with a consortium comprising EMR Capital and Adaro … for the sale of its entire 80 per cent interest in the Kestrel underground coal mine in Queensland, Australia, for $2.25 billion,’ it said in a statement.
The transaction, subject to regulatory approvals, is expected to complete in the second half of 2018.
The news comes one week after Rio Tinto agreed to offload a raft of Australian coal assets to Swiss-based commodities giant Glencore as it moves a step closer to a full exit from the industry.
The US$1.7 billion deal involves the sale of Rio’s 82 percent stake in the Hail Creek mine and its 71 percent holding in the undeveloped Valeria project, both in Queensland state.
‘The sale of Kestrel, together with the announced divestments of Hail Creek and our undeveloped coal projects, delivers exceptional value to our shareholders and will leave our portfolio stronger and more focused on delivering the highest returns through targeted allocation of capital,’ added chief executive J-S Jacques in Tuesday’s statement.