Lanco acquires Aussie coal mines for $760 million | business | Hindustan Times
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Lanco acquires Aussie coal mines for $760 million

business Updated: Mar 04, 2011 22:58 IST
HT Correspondent
HT Correspondent
Hindustan Times
Griffin coal mines

Lanco Infratech on Friday finalised the acquisition of Australia’s Griffin coal mines for an estimated $760 million (Rs 3,420 crore) in what is being seen as the largest investment made by any Indian company in West Australia.

“We are focussed on growing the Griffin coal business, and further developing the mining and infrastructure (rail and port) facilities in the region,” said L Madhusudan Rao, chairman, Lanco Infratech.

The firm had, in December 2010, announced the acquisition of Griffin Coal’s assets including thermal coal mines with a production of around 4 million tonnes (mt) per annum. Lanco acquired the mines from Griffin administrators KordaMentha, following the miner’s collapse in January 2010. It now plans to expand Griffin’s capacity nearly four fold to over 15 mt by infusing $1 billion (R4,500 crore) alongwith building infrastructure near the Bunbury port.

The coal secured from Griffin would be used as fuel to raise Lanco’s power generation capacity by over seven-fold to 15,000 MW by 2015. The expansion in the power generation would cost the firm Rs 80,000 crore.

Besides Lanco, Griffin’s assets had attracted bidders such as Reliance Power, Adani Power and GMR group, apart from interested parties from Australia and China. Previous estimates had put the value of the deal at a higher $800-850 million.

Lanco operates across a chain of strategic business units (SBUs) comprising power, construction, renewables, resources and non-power infrastructure. After griffin, the firm is still looking for options in Indonesia, Australia and Africa.

The company scrip closed at R37, down 2.8% on the Bombay Stock Exchange on Friday.