EXXARO Resources, a Johannesburg-listed coal producer, and unlisted company, Seriti Resources, were interested in bidding for a stake in South32’s South African coal business, said Bloomberg News citing people familiar with the matter.
The business – known as South Africa Energy Coal (SAEC) – is worth almost $800m, said the newswire. Phembani Group, owned by chairman Phuthuma Nhleko is also considering an offer as is the non-profit non-profit group Mining Forum of South Africa which plans to make an offer for a 30% stake, said Bloomberg News. Phembani Group is already an partner in SAEC.
Potential bids may range from about R8bn to R12bn ($790m), Bloomberg News said. South32 is divesting from SAEC because it does not foresee further investment in thermal coal which is shunned by an increasing number of investors for environmental reasons. Eskom supplier rules also mean South32 would not be well positioned to enter into new contracts with the South African power utility.
