Insight
Glencore and Sumitomo up stakes in Australian thermal coal assets
*Please note that this report only includes an Excel data file if this is indicated in "What's included" below
Report summary
On 18 December, Glencore and Sumitomo announced they had reached agreements with Mitsubishi to acquire its shares in the Clermont mine and the Ulan Coal Mines complex for a combined US$530 million (A$750 million). Mitsubishi agreed to sell its 31.4% stake in Clermont to GS Coal a 50:50 joint venture between Glencore and Sumitomo for US$400 million and its 10% stake in Ulan Coal Mines to Glencore for US$130 million. The deal highlights the difference in views about the future for thermal coal. Current high prices have provided Mitsubishi with a good opportunity to complete rebalancing its portfolio away from thermal coal. Meanwhile, Glencore and Sumitomo have elected to boost their thermal coal exposure obviously believing thermal coal remains an attractive proposition. Who will be right remains to be seen. However, based on our analysis, both deals were made at attractive prices.
Table of contents
- Overview
- Deal summary
- Clermont
- Ulan Coal complex
- Deal Analysis
Tables and charts
This report includes the following images and tables:
- Deal summary
- Location map
- Marketable reserves
- Summary valuation
- Valuation metrics
- Economic assumptions
- Thermal coal deal-implied prices
What's included
This report contains:
Other reports you may be interested in
Insight
Global coal M&A activity: October 2016
Coal M&A spend remains at historical lows this year, however the price recovery makes most of the recent deals appear well-timed.
$1,100
Insight
Global coal M&A deal pipeline: September 2016
The net value of the pipeline decreased to US$8.5 billion, due to further valuation reductions and deal announcements.
$1,100
Insight
Rio Tinto in final stage of coal exit
Rio Tinto's remaining operating assets in Queensland, Hail Creek and Kestrel, are now reported to be up for sale
$1,100
