Advertisement

Rio Tinto to sell Australian coal assets to cut costs

Rio Tinto has hired Deutsche Bank to help sell Australian coal assets that could bring in around three billion dollars, The Wall Street Journal reported Wednesday.

Rio Tinto has hired Deutsche Bank to help sell Australian coal assets that could bring in around three billion dollars, The Wall Street Journal reported Wednesday.

As part of the deal, Rio Tinto is searching for buyer for up to 29% of its Coal & Allied unit, which owns mines in the Australian state of New South Wales.

Advertisement - Article continues below

Rio is working to reduce its interest in the unit to as little as 51% in an effort to cut costs and improve shareholder returns.

The unit was snapped up by Rio Tinto and Japan's Mitsubishi Corp in 2011 which at the time valued the coal miner at 10.6bn Australian dollars.

Rio Tinto is also looking to sell interests in the Clermont and Blair Athol thermal-coal mines in the country's state of Queensland, which could fetch more than $1.0bn, people familiar with the matter told the newspaper.

A spokesman for Rio Tinto declined to comment.

The reported sell-off, comes as thermal coal has become a less attractive as a long-term investment since prices tumbled to three-year lows in September.

Advertisement
Advertisement

Recommended

Broker safety – your questions answered
Investment strategy

Broker safety – your questions answered

Cris Sholto Heaton answers more of your questions about the safety of stockbroker accounts
25 Mar 2020
How demographics affects stock valuations
Investment strategy

How demographics affects stock valuations

New research suggests that stock and bond valuations are driven by the age of the population – at least in the US.
24 Feb 2020
Do you own shares in Sirius Minerals? Here’s what you need to do now
Stocks and shares

Do you own shares in Sirius Minerals? Here’s what you need to do now

Mining giant Anglo American has proposed a cash takeover of Yorkshire-based minnow Sirius Minerals. Unhappy shareholders must decide whether to accept…
20 Feb 2020
Why investors should be “cautiously bullish” for 2020
Stockmarkets

Why investors should be “cautiously bullish” for 2020

Analysts have been out in force making rosy predictions for stockmarkets in 2020, but while there is certainly a case for optimism, investors should r…
17 Jan 2020

Most Popular

An economics lesson from my barber
Inflation

An economics lesson from my barber

On reopening his shop after lockdown, Dominic Frisby’s barber doubled his prices. It’s all part of the post-Covid inflation process – and we’re going …
8 Jul 2020
What gold, bonds and tech stocks have in common
Stockmarkets

What gold, bonds and tech stocks have in common

"Risk off" or "safe haven" assets such as gold and government bonds have been doing well lately. But so have riskier tech stocks. That seems to defy c…
10 Jul 2020
Three ideas for Lloyds Bank's new boss
UK stockmarkets

Three ideas for Lloyds Bank's new boss

The Black Horse needs whipping into shape. A change at the top provides a great opportunity, says Matthew Lynn.
12 Jul 2020