ET reported that Coal India Limited has revived talks to buy a stake in a mine of Massey energy as the new owners of the US based firm has approached the state run Indian giant in a JV.
CIL was in negotiations with Massey Energy Company's Sidney Underground Mines in the US for which Marston and Marston completed technical due diligence while Royal Bank of Scotland had concluded a financial due diligence. But talks did not make any headway after Alpha Natural Resources announced its acquisition of Massey. With Alpha Natural Resources gearing up to takeover Massey Energy, the Coal India management was not sure if it could take a stake in the mine for which negotiations were on.
But last week a team of officials from Alpha Natural Resources met the CIL chairman expressing their interest in taking the talks forward. However, CIL intends to conduct a physical verification of the assets being offered, before it proceeds further.
Mr NC Jha chairman of CIL said that "A team of officials from Alpha Natural Resources visited us last week and have shown their interest in striking a joint venture with Coal India. However, it is not clear if they want to take forward the negotiations that the Massey management was having with us. In case they are not, negotiations have to be started a fresh."
He said that Coal India will take less than 49% stake in the asset. He added that "We have concluded the financial due diligence of the asset but a physical verification is due. CIL management wants to physically visit the mine, see the way it functions, equipment used and the safety norms adhered at the mines."
Mr Jha is insisting on a physical verification since the Massey property for which CIL was in talks suffered an accident a few months ago.
The American Mine Safety & Health Administration has also filed a complaint in an US District Court asking for shut down of operations at the Sidney mines of Massey Energy allegedly due to violations in 2008. Reports also suggest that Massey has suffered several prominent disasters in recent years, including an explosion in April at the company's Upper Big Branch mine in West Virginia. (sourced ET)
CIL was in negotiations with Massey Energy Company's Sidney Underground Mines in the US for which Marston and Marston completed technical due diligence while Royal Bank of Scotland had concluded a financial due diligence. But talks did not make any headway after Alpha Natural Resources announced its acquisition of Massey. With Alpha Natural Resources gearing up to takeover Massey Energy, the Coal India management was not sure if it could take a stake in the mine for which negotiations were on.
But last week a team of officials from Alpha Natural Resources met the CIL chairman expressing their interest in taking the talks forward. However, CIL intends to conduct a physical verification of the assets being offered, before it proceeds further.
Mr NC Jha chairman of CIL said that "A team of officials from Alpha Natural Resources visited us last week and have shown their interest in striking a joint venture with Coal India. However, it is not clear if they want to take forward the negotiations that the Massey management was having with us. In case they are not, negotiations have to be started a fresh."
He said that Coal India will take less than 49% stake in the asset. He added that "We have concluded the financial due diligence of the asset but a physical verification is due. CIL management wants to physically visit the mine, see the way it functions, equipment used and the safety norms adhered at the mines."
Mr Jha is insisting on a physical verification since the Massey property for which CIL was in talks suffered an accident a few months ago.
The American Mine Safety & Health Administration has also filed a complaint in an US District Court asking for shut down of operations at the Sidney mines of Massey Energy allegedly due to violations in 2008. Reports also suggest that Massey has suffered several prominent disasters in recent years, including an explosion in April at the company's Upper Big Branch mine in West Virginia. (sourced ET)
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