Update | Yanzhou Coal Mining shares gain on US$2.45 billion Australian acquisition from Rio Tinto
Acquisition is considered ‘very substantial’ under Hong Kong listing rules. Stock surges as much as 3.2pc during Wednesday trading
Shares in Yanzhou Coal Mining, the listed unit of China’s fourth largest coal miner Yankuang Group, surged as much as 3.2 per cent after it announced plans to buy coal mining assets in Australia for US$2.45 billion from global mining giant Rio Tinto.
The deal comes after the price of power station coal delivered at the port of Newcastle port in Australia almost doubled in November from June to a four-year high of US$100 a tonne after China, the world’s largest coal producer, slashed output last year.
Yancoal Australia, the Shandong province-based company’s Australia subsidiary, has agreed to buy three coal mines and related assets in the Hunter Valley region of the state of New South Wales.
The deal would see Yancoal “develop, expand and diversify its high quality and low cost coal portfolio in Australia”, Yanzhou said in a filing to Hong Kong Stock Exchange on Wednesday.
“The board also expects the acquisition to create synergies with its existing operations in Australia and further expand its coal production.”
Yancoal already has two operating mines in New South Wales.