Mineral major NMDC has zeroed in on a ‘small' coking coal mine in Russia. The company is expected to seek Board approval for the targeted acquisition in the next 10-12 days.
“It's a small asset of 70 million tonne. Our team has already been to Russia to take stock of the asset. We are expecting to complete the due diligence and approach the Board in this regard in the next 10-12 days,” NMDC Chairman and Managing Director, Mr Rana Som told newspersons on the sidelines of a seminar organised by the Mining, Geological and Metallurgical Institute of India.
On the structure of the proposed acquisition, he said that the company prefers to acquire operating interest. “We will try to acquire maximum interest in the asset. However, eventually, we may dilute part of the holding to any other party to share the investment,” Mr Som said.
US acquisition bid
Though the due diligence on another coal asset in Alabama in the US is nearing completion, Mr Som indicated that NMDC was not planning to go ahead to acquire the same at this juncture. “We have no plans to approach the Board with this acquisition proposal, now,” he said.
Severstal pact
The company will also enter into a firm pact with Russian steel major Severstal for building a two million tonne steel plant in Karnataka, in October.
The company has already entered into a memorandum of understanding (MoU) with the Russian company in this regard.
“We will convert the MoU into a MOA (memorandum of association) within a month”, he said.
As per the memorandum, NMDC would supply iron ore to the steel joint venture while Severstal will transfer its coking coal asset in Russia in favour of the venture.