Essar acquires Trinity Coal for USD 600 mn
Ruias-led Essar Global has said it has acquired US-based Trinity Coal for USD 600-million, a move which will help the firm meet its rising raw material requirement for its steel business.business Updated: Mar 07, 2010 16:38 IST
Ruias-led Essar Global has said it has acquired US-based Trinity Coal for USD 600-million, a move which will help the firm meet its rising raw material requirement for its steel business.
"We acquired a 100 per cent ownership in Trinity Coal for USD 600-million from Boston-based Denham Capital, with a view to become an integrated player in the region," Essar Group's Chief Executive Officer Prashant Ruia said.
The deal, conducted through its subsidiary Essar Minerals, Delaware, is subject to relevant approvals and is expected to close by end-this month, he said.
The transaction is a part of Essar's strategy to continue to achieve backward integration and secure raw material needs for its global steel and power operations.
Trinity Coal has an estimated reserves of about 200 million tonnes, including both metallurgical and thermal.
Coal, along with iron ore, is a vital input for making steel.
It has an annual production capacity of 7 million tonnes. The Indian conglomerate runs steel mills in Hazira, Gujarat. It also has a plant in Algoma, Canada and is building a steel plant in Minnesota in the US where the company possesses iron ore reserves of about 1.4 billion tonnes.
He added that coal from Trinity would also be used for the group's steel plant operations in Algoma in Canada.
Additionally, the Group is scaling up its power generation capacity in India to 6,000 megawatts (MW), Ruia said.
Essar's US investments will increase to USD4 billion, Ruia said, adding the company will continue to scout for more acquisitions.
"We are looking at consolidation and acquisitions in the mineral space globally as the demand (for minerals) in India is high," Ruia said.
The Essar Group is a multinational conglomerate and a leading player in steel, energy, power, communications, shipping, ports & logistics, construction, mining and minerals.
With operations in over 20 countries across five continents the Group employs 60,000 people, with revenues of USD 15-billion.