NMDC has decided to go full throttle in securing at least three mines in Russia for about Rs 1,600 crore. Besides,the navratna company will also invest 1,75,950 Australian dollars (Rs 95,02,162) for buying out 50 per cent stake of Legacy Iron Ore Ltds mines in Australia within two months.
In its meeting on April 16,the NMDC Board deliberated extensively on the companys proposals to acquire the three mines in Russia and directed that the PSU should commence an internal due diligence on acquiring the South Coal project in Rostov owned by Cyprus-based Coal Mining Investments Ltd having reserves of 364 million tonne.
A team of senior NMDC officials have been asked to ascertain the economic viability of the project,the logistical issues in ferrying the mined coal back to India.
The board also asked the PSU to begin external due diligence for another project also in Siberia called the Barovushinsky coal project owned by Leirei Ltd also based in Cyprus and with a reserve of over 80 MT.
The navratna firm is also eyeing another acquisition of South Kemerovo coal project owned by Jalpar Ltd in Nicosia and has an estimated reserves of nearly 50 MT,a senior NMDC official said. Keen to ensure that all dry details pertaining to these firms are available before formally proceeding to acquire them,NMDC has requested steel ministry to ask the Indian embassy in Moscow to provide detailed information on them.
To execute acquisition of the Legacy mine in Australia,the board decided that NMDC should pay 1,75,950 AUD (Rs 95,02,162) to acquire 1.5 million shares at least 50 per cent stake at 0.1173 per share.
These acquisitions will cost the company nearly Rs 1,600 crore, the official said and informed that the PSU has earmarked more than Rs 5,000 crore to execute acquisitions of overseas mineral assets. With cash reserves of over Rs 18,000 crore,NMDC has is confident that it can establish a global footprint. After acquiring Legacy,the miner and is eyeing to acquire two more properties,the Ridley iron ore mine and Wonarah phosphate also in Australia.
The board also decided that the PSU should forsake its efforts to acquire at least 25 per cent strategic stake in Ferrexpo Plc.