Inner Mongolia Yitai Coal, which is preparing for an initial public offering of up to US$1.5 billion, plans to acquire the bulk of the remaining mining assets of its parent, Yitai Group, after the listing.
The deal is expected to be worth 8.4 billion yuan (HK$10.25 billion).
Yitai Coal, a former state-owned enterprise privatised by its employees, prepared for a Hong Kong listing in 2010, but regulatory approvals took much longer than expected. It has issued and listed foreign currency-denominated B shares in Shanghai since 1997. Yitai Group owns 60 per cent of Yitai Coal.
Its preliminary listing prospectus filed with the Hong Kong stock exchange said Yitai Coal, the biggest local producer in the nation's biggest coal-mining region, had seven operating coal mines with total proved and probable marketable reserves of 580.4 million tonnes at the end of last year. Their combined annual output was 35.2 million tonnes.
It also has two mines under development, with total marketable reserves of 567 million tonnes. They will start production next year, with a projected combined output of 7.6 million tonnes in 2014.
Yitai Coal has budgeted capital expenditure of 3.24 billion yuan for this year, of which 1.64 billion yuan is earmarked for expanding coal logistics facilities, 1.07 billion yuan for coal mine development and 540 million yuan for coal-to-chemicals projects.
