Wednesday, 15 Feb 2012
ET reported that Integrated power generator JSW Energy, looking for suitable acquisitions inside India is planning to set up a 450-600-MW coal-fired plant in South Africa where the power sector is opening up for investment.
Mr Navraj Singh senior vice president, business development, JSW Energy said "We are interested in acquiring power projects in India. The sector will now see only serious long-term players. Many of the new players have put on hold their projects or are going slow,"
He said the decision on target companies would depend on the total package, whether land acquisition has been done and the like.
Mr Singh said "South Africa's power sector is now opening up. We have a mine there and are looking at setting up a power plant with a capacity ranging between 450 MW and 600 MW. We are also looking at additional mines in South Africa."
He said the company was also setting up a 240-MW hydel power project at Kuther in Himachal Pradesh for which land acquisition is under progress and bids for civil works are being evaluated.
He added that the company new projects in India are progressing at a good pace.
Mr Singh said "Land acquisition process is on for our Chattisgarh power project (2x660 MW). We will need about 300 acres. The project has got environmental clearance and water allocation.”
He also said "In West Bengal, we are putting up a 300-MW captive power plant for our steel mill. In the second phase we will put up a 1,320-MW (2x660 MW) project which will be an independent power producer (IPP) project."
Sector analysts said many of the domestic power projects have hit the roadblock and only long term players can continue in this space.
An analyst not wanting to be named told IANS that "There are small power projects in the south facing issues of fuel linkage/supplies. For JSW Energy, the path for faster growth is through acquisitions. The kind of projects that would entice the company would be those having land on hand but not fuel linkage, or strong balance sheet to look for other options like imports or going in for own coal mine."
Meanwhile, JSW Energy, with a domestic generation capacity of 2,600 MW is planning to put up a pit head power plant in South Africa where it has a 0.5 million tonne coal mine.
(Sourced from ET)
Showing posts with label JSW Energy. Show all posts
Showing posts with label JSW Energy. Show all posts
Wednesday, February 15, 2012
Monday, December 12, 2011
Indonesia coal pricing norm affects Indian power companies
Monday, 12 Dec 2011
About 14,000 MW of capacity addition in the pipeline, based on Indonesian coal, appears to have hit a roadblock after Indonesia made it mandatory for coal exports to be benchmarked to international prices from September 23.
TATA Power, Reliance Power, Adani Power, JSW Energy and Lanco Infratech had aggressively bid in the tariff based competitive bidding process for power projects, based on their agreements/ arrangements they had made for fuel stock from Indonesia.
It is learnt that the developers had worked the financials of their projects factoring in the coal price they had entered into in Indonesia for long term supply, which in some cases are about USD 26 to USD 30 a tonne, almost half the benchmark prices.
TATA Power has commissioned the first of its 830 MW unit at Mundra. Reliance Power has slowed down work at its 4,000 MW Krishnapatnam project till a decision is taken as no substantial investments had been made and lenders too were reluctant to release funds citing fuel price cost.
Mr Ashok Khurana director general of Association of Power Producers the apex body of power developers in the country said that “The issue concerns about 20,000 MW of stranded capacity.”
He said that the association is only asking the Government for a forum or mechanism where the voices of the developers would be heard. A decision needs to be taken. It is not only about imported coal even domestic producers are impacted as Coal India is not able to address their requirements.
Mr Khurana said it must be understood that the ultra mega power project format was put up by the Government and assurances were given. It is not the developers' fault. Today bankers and investor were spurning them. Asking developers to speak to procurers is just passing the buck.
A few months back, Mr Alok Kanagat, Chief Executive Officer, Coastal Gujarat Power, wrote to the Power Minister stating that while initial calculations based on the Central Electricity Regulatory Commission norms provided for 14% return on equity would be around INR 600 crore per annum, but with the coal cost increase the impact could be up to INR 1,800 crore and nullify returns. Further, the impact on tariff could be up to INR 1 per unit.
To tide over the crisis, TATA Power has provisioned INR 823 crore for impairment in Coastal Gujarat Power Ltd this quarter. This has been worked out on the projected fuel cost that could impact future cash flows. Further, to address coal price volatility, Tata Power said it would also consider transferring 75% ownership of investments in coal companies to CGPL.
(Sourced from BL)
About 14,000 MW of capacity addition in the pipeline, based on Indonesian coal, appears to have hit a roadblock after Indonesia made it mandatory for coal exports to be benchmarked to international prices from September 23.
TATA Power, Reliance Power, Adani Power, JSW Energy and Lanco Infratech had aggressively bid in the tariff based competitive bidding process for power projects, based on their agreements/ arrangements they had made for fuel stock from Indonesia.
It is learnt that the developers had worked the financials of their projects factoring in the coal price they had entered into in Indonesia for long term supply, which in some cases are about USD 26 to USD 30 a tonne, almost half the benchmark prices.
TATA Power has commissioned the first of its 830 MW unit at Mundra. Reliance Power has slowed down work at its 4,000 MW Krishnapatnam project till a decision is taken as no substantial investments had been made and lenders too were reluctant to release funds citing fuel price cost.
Mr Ashok Khurana director general of Association of Power Producers the apex body of power developers in the country said that “The issue concerns about 20,000 MW of stranded capacity.”
He said that the association is only asking the Government for a forum or mechanism where the voices of the developers would be heard. A decision needs to be taken. It is not only about imported coal even domestic producers are impacted as Coal India is not able to address their requirements.
Mr Khurana said it must be understood that the ultra mega power project format was put up by the Government and assurances were given. It is not the developers' fault. Today bankers and investor were spurning them. Asking developers to speak to procurers is just passing the buck.
A few months back, Mr Alok Kanagat, Chief Executive Officer, Coastal Gujarat Power, wrote to the Power Minister stating that while initial calculations based on the Central Electricity Regulatory Commission norms provided for 14% return on equity would be around INR 600 crore per annum, but with the coal cost increase the impact could be up to INR 1,800 crore and nullify returns. Further, the impact on tariff could be up to INR 1 per unit.
To tide over the crisis, TATA Power has provisioned INR 823 crore for impairment in Coastal Gujarat Power Ltd this quarter. This has been worked out on the projected fuel cost that could impact future cash flows. Further, to address coal price volatility, Tata Power said it would also consider transferring 75% ownership of investments in coal companies to CGPL.
(Sourced from BL)
Thursday, November 17, 2011
JSW undecided on Mozambique block
Thu,November 17, 2011
Mumbai: JSW Steel had plans to transfer thermal coal mine to the power arm, but the boards have yet to discuss the transfer.
Sajjan JindalJSW Steel had plans to transfer thermal coal mine to the power arm, but the boards have yet to discuss the transfer.
One may call it the curious case of the coal mine in Mozambique for the $7-billion diversified JSW Group.
At a time when its power arm, JSW Energy, is severely hamstrung due to the lack of captive coal resources to fire its thermal power portfolio, analysts and company shareholders are puzzled at the delay in transferring an existing coal mine within group companies.
Two years ago, during launch of the Rs 2,700-crore JSW Energy IPO, Sajjan Jindal, chairman of the group, had said JSW Steel was looking at selling the Mozambique coal mines to group company JSW Energy for Rs 300 crore. The decision was taken after it was discovered the majority of coal in the mine was thermal, more suited for power production.
Steel companies use coking coal. Considering JSW Energy did not possess any captive resources, the Mozambique mines were considered strategic.
But in the last two years, neither board has been able to finalise the transfer of the crucial asset.
When asked, Pramod Menon, CFO, JSW Energy, said the respective boards were yet to take up the transfer. "It is an issue which has to be considered by the boards," he said.
When asked why the two boards hadn’t discussed the issue, he said, "They are two separately-listed entities and one of them has an asset which belongs to them. Today, we have not yet considered the asset from the (JSW) Energy's perspective, nor have we got anything from (JSW) Steel if they would like to sell."
A corporate lawyer, who isn't allowed to speak to the media, said, "Since it is a non-core asset there should not be an issue in the deal, provided both boards agree upon the sale and the pricing, etc."
He said it was normal for companies to have such transactions within group companies. "There are a lot of asset transfers that happen within companies. But they have to take care that the deal is at arms-length."
JSW Energy said there were logistic challenges in Mozambique and the company would look at the merits of the projects before it is offered to them. Sajjan Jindal is the chairman and managing director of JSW Steel, as well as JSW Energy.
JSW Steel also has its own captive power plant of 300 Mw, which would be commissioned soon. The company might be keeping the coal block for their own use, Menon said.
Questions sent to JSW Steel remained unanswered.
An analyst tracking the sector and the company, said, "JSW Energy has been looking to acquire coal assets abroad and the Mozambique coal block transfer was definitely a positive story. However, we are yet to see the two companies make the deal."
Volatile coal prices have been consistently denting the profitability of JSW Energy, as even now the company predominantly relies on spot market deals to source raw material, having no long-term fuel security.
Imported coal prices have risen 30 per cent in the last one year and availability from Indian sources like Coal India have become extremely unreliable.
But what seems more odd is the fact, when the resource crunch is severely hurting the company's growth, there is no work ongoing also to develop the Mozambique mines and they are lying idle.
For the quarter ended September, the company's fuel costs grew 86 per cent on soaring spot coal prices, resulting in a net loss ofRs 109 crore, even as its income grew 18 per cent. A depreciating rupee further hit the company's earnings.
In the last one year, JSW Energy stock was down 60 per cent. On Wednesday it closed at Rs 46.4/share.
However, L K Gupta, deputy managing director, JSW Energy, said the company will definitely spring back to profitability in the third quarter as coal prices were coming down and its various expansion plans were getting commissioned.
Talking about efforts being undertaken to identify new sources of coal. Menon said that there is a drop in coal indexes in North and South America and the company is finding very attractive rates to tie up coal. "In terms of acquisitions, we are still looking out for opportunities. As and when we come across any asset which is making economic sense and in terms of size which we can chew, we will look at it. At this point in time we are evaluating assets but there is nothing that we can talk about.""For acquisitions, the question is what kind of landed cost of coal we are looking and if the acquisition can be a long term one.
Our balance sheet is very strong. Our consolidated net debt gearing is 1.7 times. So, in terms of leveraging and buy-outs it will not be an issue. We can look at an acquisition in the region of $250-$500 million," Menon added. Earlier this year, the company made a failed attempt at buying Canadian coal miner CIC Energy's asset in Botswana for $418 million. The company even extended the deadline to complete the deal once but decided to call off the deal. There have been rumours that JSW Energy might bid for New Hope of Australia. However, the company denied the news categorically.
(sourced BS)
Mumbai: JSW Steel had plans to transfer thermal coal mine to the power arm, but the boards have yet to discuss the transfer.
Sajjan JindalJSW Steel had plans to transfer thermal coal mine to the power arm, but the boards have yet to discuss the transfer.
One may call it the curious case of the coal mine in Mozambique for the $7-billion diversified JSW Group.
At a time when its power arm, JSW Energy, is severely hamstrung due to the lack of captive coal resources to fire its thermal power portfolio, analysts and company shareholders are puzzled at the delay in transferring an existing coal mine within group companies.
Two years ago, during launch of the Rs 2,700-crore JSW Energy IPO, Sajjan Jindal, chairman of the group, had said JSW Steel was looking at selling the Mozambique coal mines to group company JSW Energy for Rs 300 crore. The decision was taken after it was discovered the majority of coal in the mine was thermal, more suited for power production.
Steel companies use coking coal. Considering JSW Energy did not possess any captive resources, the Mozambique mines were considered strategic.
But in the last two years, neither board has been able to finalise the transfer of the crucial asset.
When asked, Pramod Menon, CFO, JSW Energy, said the respective boards were yet to take up the transfer. "It is an issue which has to be considered by the boards," he said.
When asked why the two boards hadn’t discussed the issue, he said, "They are two separately-listed entities and one of them has an asset which belongs to them. Today, we have not yet considered the asset from the (JSW) Energy's perspective, nor have we got anything from (JSW) Steel if they would like to sell."
A corporate lawyer, who isn't allowed to speak to the media, said, "Since it is a non-core asset there should not be an issue in the deal, provided both boards agree upon the sale and the pricing, etc."
He said it was normal for companies to have such transactions within group companies. "There are a lot of asset transfers that happen within companies. But they have to take care that the deal is at arms-length."
JSW Energy said there were logistic challenges in Mozambique and the company would look at the merits of the projects before it is offered to them. Sajjan Jindal is the chairman and managing director of JSW Steel, as well as JSW Energy.
JSW Steel also has its own captive power plant of 300 Mw, which would be commissioned soon. The company might be keeping the coal block for their own use, Menon said.
Questions sent to JSW Steel remained unanswered.
An analyst tracking the sector and the company, said, "JSW Energy has been looking to acquire coal assets abroad and the Mozambique coal block transfer was definitely a positive story. However, we are yet to see the two companies make the deal."
Volatile coal prices have been consistently denting the profitability of JSW Energy, as even now the company predominantly relies on spot market deals to source raw material, having no long-term fuel security.
Imported coal prices have risen 30 per cent in the last one year and availability from Indian sources like Coal India have become extremely unreliable.
But what seems more odd is the fact, when the resource crunch is severely hurting the company's growth, there is no work ongoing also to develop the Mozambique mines and they are lying idle.
For the quarter ended September, the company's fuel costs grew 86 per cent on soaring spot coal prices, resulting in a net loss ofRs 109 crore, even as its income grew 18 per cent. A depreciating rupee further hit the company's earnings.
In the last one year, JSW Energy stock was down 60 per cent. On Wednesday it closed at Rs 46.4/share.
However, L K Gupta, deputy managing director, JSW Energy, said the company will definitely spring back to profitability in the third quarter as coal prices were coming down and its various expansion plans were getting commissioned.
Talking about efforts being undertaken to identify new sources of coal. Menon said that there is a drop in coal indexes in North and South America and the company is finding very attractive rates to tie up coal. "In terms of acquisitions, we are still looking out for opportunities. As and when we come across any asset which is making economic sense and in terms of size which we can chew, we will look at it. At this point in time we are evaluating assets but there is nothing that we can talk about.""For acquisitions, the question is what kind of landed cost of coal we are looking and if the acquisition can be a long term one.
Our balance sheet is very strong. Our consolidated net debt gearing is 1.7 times. So, in terms of leveraging and buy-outs it will not be an issue. We can look at an acquisition in the region of $250-$500 million," Menon added. Earlier this year, the company made a failed attempt at buying Canadian coal miner CIC Energy's asset in Botswana for $418 million. The company even extended the deadline to complete the deal once but decided to call off the deal. There have been rumours that JSW Energy might bid for New Hope of Australia. However, the company denied the news categorically.
(sourced BS)
Friday, November 11, 2011
JSW Energy not bidding for New Hope coal assets - Report
Friday, 11 Nov 2011
Power utility JSW Energy is not looking to bid for Australia's New Hope coal assets, but declined to comment for other group firms.
Mr Lalit Kumar Gupta joint MD & CEO told reporters that the company expects to swing back to profit in the current quarter on back of coal prices correcting and tariff hikes.
Earlier, the firm posted a net loss of INR 1.09 billion for July-Sept quarter.
(Sourced from Reuters)
Power utility JSW Energy is not looking to bid for Australia's New Hope coal assets, but declined to comment for other group firms.
Mr Lalit Kumar Gupta joint MD & CEO told reporters that the company expects to swing back to profit in the current quarter on back of coal prices correcting and tariff hikes.
Earlier, the firm posted a net loss of INR 1.09 billion for July-Sept quarter.
(Sourced from Reuters)
Tuesday, October 25, 2011
India September Coal Imports Dropped 6.3%, Interocean Data Show
Tue,Oct 25, 2011
Coal imports by India’s power, cement and steel companies fell 6.3 percent in September, the second consecutive monthly drop, according to data from the Interocean Group of Companies.
Adani Enterprises Ltd. (ADE), Bhatia International Ltd., JSW Energy Ltd. (JSW) and other companies imported 9.27 million metric tons of steam and coking coal last month via 28 Indian ports, Interocean, a New Delhi-based ship broker, said in a document obtained by Bloomberg News. That’s down from 9.9 million tons received in August.
Mundra, a port on the west coast, where the Adani group imports most of its coal, received the highest shipments totaling 1.9 million tons. The eastern ports of Paradip, Krishnapatnam and Gangavaram received 927,213 tons, 723,422 tons and 624,837 tons of the commodity, respectively, Interocean data showed. Visakhapatnam, also in the east, received 615,225 tons.
Most imports came from Indonesia, Australia and South Africa, according to the document.
(sourced Bloomberg)
Coal imports by India’s power, cement and steel companies fell 6.3 percent in September, the second consecutive monthly drop, according to data from the Interocean Group of Companies.
Adani Enterprises Ltd. (ADE), Bhatia International Ltd., JSW Energy Ltd. (JSW) and other companies imported 9.27 million metric tons of steam and coking coal last month via 28 Indian ports, Interocean, a New Delhi-based ship broker, said in a document obtained by Bloomberg News. That’s down from 9.9 million tons received in August.
Mundra, a port on the west coast, where the Adani group imports most of its coal, received the highest shipments totaling 1.9 million tons. The eastern ports of Paradip, Krishnapatnam and Gangavaram received 927,213 tons, 723,422 tons and 624,837 tons of the commodity, respectively, Interocean data showed. Visakhapatnam, also in the east, received 615,225 tons.
Most imports came from Indonesia, Australia and South Africa, according to the document.
(sourced Bloomberg)
Monday, July 25, 2011
JSW Energy Ratnagiri expansion postponed - Report
Monday, 25 Jul 2011 | By BS
BS reported that JSW Energy said the plan to expand its Ratnagiri power plant by 3,200 MW would be postponed till issues regarding imported coal were sorted.
However, the plan for 1,200 MW of capacity would be commissioned on schedule. Two units of this project are physically operational, the third has begun commercial operation and the fourth unit will be operational soon.
Mr Sajjan Jindal chairman said they were awaiting clarity on the government stand regarding imported coal based projects before going for more of such capacity.
These projects are facing trouble since Indonesia decided to index its coal exports to global prices and Australia is coming up with a tax on mining. The company is already importing all its coal requirements on a spot basis and is facing the heat.
Saturday, July 23, 2011
JSW Energy puts Ratnagiri plans on hold due to high coal prices
July23, 2011ByJohn Satish Kumar Livemint
The rising price of coal has forced JSW Energy Ltd to put a 2,000 megawatts (MW) capacity expansion plan at Ratnagiri on hold.
The power producer will plan future projects on assured domestic coal linkages, vice-chairman and managing director Sajjan Jindal said on the sidelines of its annual shareholder meeting.
“Long-term contracts are not a solution as prices have to be renegotiated all the time,” Jindal said. “The only way forward is for the government to give coal linkages and we expect to hear something on this front shortly.”
Even owning coal mines abroad doesn’t help as coal has to be brought into the country at benchmark prices, he said.
Over the past year, ICE Rotterdam coal price has risen more than 26% to $124.35 per tonne, according to Bloomberg data. JSW Energy needs about 10 million tonnes of coal each year and imports all its requirement.
The company has two units producing 300MW each at Ratnagiri. A third 300MW unit started production in May, while a fourth unit of similar capacity is close to commissioning. JSW Energy had planned to add another 2,000MW.
The company declared a 42% fall in stand-alone net profit for the June quarter compared with a year earlier despite growing sales, mainly owing to rising expenses.
Stand-alone net profit for the three months ended 30 June fell to 190.26 crore from 327.20 crore, while net sales rose 27% to 1,119.26 crore.
Total expenses soared 84% to 856.07 crore, with a 77% rise in fuel costs doing most of the damage.
Other expenses also more than doubled to 65.04 crore from 25.50 crore.
The company’s stock fell 6.6% to 71 on the Bombay Stock Exchange, while the benchmark Sensex index fell 0.4%.
JSW Energy said it plans to take various measures to mitigate the impact of rising imported coal prices and reduce fuel costs in the coming quarters, without elaborating.
Monday, March 28, 2011
Jindals, Reddys may jointly bid for Hancock's assets
Mon Mar28, 2011
Tags : CNPC, Sinopec Group, CNOOC,
BANGALORE/MUMBAI: The Jindals and the Reddys of the GVK Group could join hands with a third Indian company to offer a combined bid for the coal assets of Australia's Hancock Coal, which is valued at more than $2.7 billion, as a worldwide race for thermal coal spikes valuations of the mineral. The Jindals' JSW Energy has suggested to its Indian counterparts, including the Aditya Birla group , on forming a consortium similar to the strategy typically adopted by Chinese companies, to pool finances and present a formidable bid for large global assets.
"We have suggested this option and are awaiting their reaction," said a person directly involved in the negotiations. The valuations of the (Hancock) mines has become very expensive and it would be a good idea to put in a joint bid," he added.
The Aditya Birla Group, which is looking at the mines through its unlisted subsidiary Essel Mining, didn't comment on the consortium proposal. GVK Power vice- chairman Sanjay Reddy said that although his firm is keen on owning coal mines in Australia and Indonesia, he didn't elaborate on the bids. Indian state-run companies have already formed such a consortium, the International Coal Ventures Ltd that looks at bidding for coal and ore assets.
Hancock Coal is selling Kevin's Corner and Alpha Coal, both located in the Queensland province, as it expects strong valuations for the assets which are estimated to have 7.9 billion tonnes of thermal coal, according to the company's website. Thermal coal is used by power producers and although India has large deposits of the mineral, a high ash content and inadequate production by state-run major Coal India, is forcing Indian utilities to scout overseas for the coal. So far, Australia, Indonesia and countries in Africa have been common destinations for Indian power firms.
Korean firm Korya Electric and Power Company and two other Chinese bidders are also in the fray for Hancock, said the people who are aware of the negotiations with the Australian company. In the past, Chinese oil giants, including CNPC, Sinopec Group and CNOOC, have shared strengths to bid for large oil assets which are typically valued at more than $10 billion. The firms have pooled finances and technical skills and manpower to present an attractive package for the shareholders of target companies.
"While it's a convenient method to acquire large assets, varied management styles of the companies in the consortium could prove to be a handicap," said a person from a financial services company.
A delegation from Hancock is scheduled to visit India early next month for final discussions with Indian companies, said one of the persons cited earlier. The delegation is also scheduled to visit China after the India trip. Hancock does not own a captive port facility to transport coal which could have prompted several bidders to withdraw from indicative bids. The costs of building an infrastructure, like a port, would almost as that of the mine. (sourced:Economic Times)
"We have suggested this option and are awaiting their reaction," said a person directly involved in the negotiations. The valuations of the (Hancock) mines has become very expensive and it would be a good idea to put in a joint bid," he added.
The Aditya Birla Group, which is looking at the mines through its unlisted subsidiary Essel Mining, didn't comment on the consortium proposal. GVK Power vice- chairman Sanjay Reddy said that although his firm is keen on owning coal mines in Australia and Indonesia, he didn't elaborate on the bids. Indian state-run companies have already formed such a consortium, the International Coal Ventures Ltd that looks at bidding for coal and ore assets.
Hancock Coal is selling Kevin's Corner and Alpha Coal, both located in the Queensland province, as it expects strong valuations for the assets which are estimated to have 7.9 billion tonnes of thermal coal, according to the company's website. Thermal coal is used by power producers and although India has large deposits of the mineral, a high ash content and inadequate production by state-run major Coal India, is forcing Indian utilities to scout overseas for the coal. So far, Australia, Indonesia and countries in Africa have been common destinations for Indian power firms.
Korean firm Korya Electric and Power Company and two other Chinese bidders are also in the fray for Hancock, said the people who are aware of the negotiations with the Australian company. In the past, Chinese oil giants, including CNPC, Sinopec Group and CNOOC, have shared strengths to bid for large oil assets which are typically valued at more than $10 billion. The firms have pooled finances and technical skills and manpower to present an attractive package for the shareholders of target companies.
"While it's a convenient method to acquire large assets, varied management styles of the companies in the consortium could prove to be a handicap," said a person from a financial services company.
A delegation from Hancock is scheduled to visit India early next month for final discussions with Indian companies, said one of the persons cited earlier. The delegation is also scheduled to visit China after the India trip. Hancock does not own a captive port facility to transport coal which could have prompted several bidders to withdraw from indicative bids. The costs of building an infrastructure, like a port, would almost as that of the mine. (sourced:Economic Times)
Tags : CNPC, Sinopec Group, CNOOC,
Friday, March 4, 2011
GVK, JSW unit may submit fresh bids for Hancock's coal assets
4 Mar,2011
By Sameer Hashmi,ET
By Sameer Hashmi,ET
JSW Energy and GVK Power and Infrastructure will have to submit fresh bids for acquiring two coal assets put on the block by Hancock Coal as the Australian firm now wants joint bids for the assets, sources said.
Hancock Coal is selling Kevin's Corner and Alpha Coal, both located in Australia's Queensland province, as it expects good valuation for the assets.
Some Chinese and Japanese power generation companies are also among the shortlisted bidders.
The two Indian firms, however, declined to comment on the development.
"We have been looking at various assets and Hancock is one of them," GVK's vice chairman Sanjay Reddy told ET NOW. "Unfortunately we are subject to confidentiality with Hancock, so I won't be able to comment."
GVK has been scouting for coal mines for the past two years as it wants to secure fuel for its power projects, but it has so far failed to clinch a single deal due to weak financial bids.
"For us, at this point of time, CIC is the main focus," JSW Energy's joint managing director and chief executive L K Gupta said.
Sajjan Jindal-led JSW Energy is in the process of buying out UK-based power and coal mining firm CIC Energy Corporation. The deal was supposed to close on February 28, but the date for completing the acquisition was extended after CIC announced a dispute with GCL Botswana.
Hancock is expected to finalise one buyer by the end of this month. Kevin's Corner and Alpha Coal are located close to the mine that Adani Enterprises acquired last year from Linc Energy.
"The valuation could go over $4 billion considering the asset size," a source said. "There is a possibility that some players may exit the race since the valuations is so high." The two mines have an estimated 7.9 billion tonnes of thermal coal, according to the company's website.
Tags: Australia Queensland, Chinese power company, Japanese power co., bidders,
Hancock Coal is selling Kevin's Corner and Alpha Coal, both located in Australia's Queensland province, as it expects good valuation for the assets.
Some Chinese and Japanese power generation companies are also among the shortlisted bidders.
The two Indian firms, however, declined to comment on the development.
"We have been looking at various assets and Hancock is one of them," GVK's vice chairman Sanjay Reddy told ET NOW. "Unfortunately we are subject to confidentiality with Hancock, so I won't be able to comment."
GVK has been scouting for coal mines for the past two years as it wants to secure fuel for its power projects, but it has so far failed to clinch a single deal due to weak financial bids.
"For us, at this point of time, CIC is the main focus," JSW Energy's joint managing director and chief executive L K Gupta said.
Sajjan Jindal-led JSW Energy is in the process of buying out UK-based power and coal mining firm CIC Energy Corporation. The deal was supposed to close on February 28, but the date for completing the acquisition was extended after CIC announced a dispute with GCL Botswana.
Hancock is expected to finalise one buyer by the end of this month. Kevin's Corner and Alpha Coal are located close to the mine that Adani Enterprises acquired last year from Linc Energy.
"The valuation could go over $4 billion considering the asset size," a source said. "There is a possibility that some players may exit the race since the valuations is so high." The two mines have an estimated 7.9 billion tonnes of thermal coal, according to the company's website.
Tags: Australia Queensland, Chinese power company, Japanese power co., bidders,
Monday, January 10, 2011
Mergers & Acquisitions: CIC Energy agrees to offer from India’s JSW Energy
India’s JSW Energy has agreed to buy developer CIC Energy for C$7,42 a share in cash, in a transaction that has the support of the Toronto- and Botswana-listed company’s board.
CIC Energy owns the Mmamabula coal and power station project, in Botswana. Shares in the company jumped 33% last week after a trading halt was lifted, to C$6,91.
The announcement is the second investment by JSW in Southern African coal this year, after buying a stake in JSE-listed coal junior South African Coal Mining Holdings.
The offer, which values CIC at about C$422-million, represents a 203% premium to the volume-weighted average trading price for the company’s shares on the TSX for the 30-trading-day period ended September 14, the day before CIC announced it had received the takeover proposal.
However, the price is below the non- binding C$7,75 a share that CIC had previously indicated it could receive after entering exclusive negotiations last month.
“We believe that the terms of this offer provide fair value for CIC Energy shareholders in the current environment,” CIC chairperson and CEO Warren Newfield said in a statement.
“With South Africa’s increasingly apparent shift in energy policy, the outlook for coal-based power producers looking to supply South Africa has weakened.”
CIC has been waiting for an agreement to supply about 75% of the electricity from the Mmamabula project to South African utility Eskom.
But South Africa published a draft second Integrated Resource Plan in early October, outlining the country’s energy plans from 2013 onwards, which appeared to exclude plans to source coal-fired energy from projects in the rest of sub-Saharan Africa until after 2020.
CIC announced on October 8 that it had entered into exclusive negotiations on a take- over by an unnamed “multibillion-dollar conglomerate” which could buy between 51% and 100% of the company, at a nonbinding price of C$7,75 a share.
The October exclusivity agreement followed the announcement about a month earlier that the company had received an indicative proposal “from a multibillion- dollar Indian conglomerate with interests which include coal mining and power generation”.
CIC said last week that it had received a positive fairness opinion on the JSW offer from financial adviser Deutsche Bank Securities, and that the company’s directors and officers of CIC Energy had agreed to enter into lock-up agreements with JSW to tender their shares into the offer.
Under the agreement between the two companies, JSW must launch its offer by December 20, subject to due diligence, no material adverse change and shareholders representing at least 20% of CIC’s outstanding shares, including the officers and directors, having entered into lock-up agreements.
The offer will require government and regulatory approvals and approval by shareholders representing at least two-thirds of CIC Energy shares on a partially diluted basis.
CIC has agreed not to solicit other transactions, and JSW will have the right to match any superior offer. CIC will, under certain circumstances, also pay a break fee of about C$10,5-million if the acquisition is not completed.
News via miningweekly.com by Liezel Hill, 3rd December 2010
Edited by: Martin Zhuwakinyu
CIC Energy owns the Mmamabula coal and power station project, in Botswana. Shares in the company jumped 33% last week after a trading halt was lifted, to C$6,91.
The announcement is the second investment by JSW in Southern African coal this year, after buying a stake in JSE-listed coal junior South African Coal Mining Holdings.
The offer, which values CIC at about C$422-million, represents a 203% premium to the volume-weighted average trading price for the company’s shares on the TSX for the 30-trading-day period ended September 14, the day before CIC announced it had received the takeover proposal.
However, the price is below the non- binding C$7,75 a share that CIC had previously indicated it could receive after entering exclusive negotiations last month.
“We believe that the terms of this offer provide fair value for CIC Energy shareholders in the current environment,” CIC chairperson and CEO Warren Newfield said in a statement.
“With South Africa’s increasingly apparent shift in energy policy, the outlook for coal-based power producers looking to supply South Africa has weakened.”
CIC has been waiting for an agreement to supply about 75% of the electricity from the Mmamabula project to South African utility Eskom.
But South Africa published a draft second Integrated Resource Plan in early October, outlining the country’s energy plans from 2013 onwards, which appeared to exclude plans to source coal-fired energy from projects in the rest of sub-Saharan Africa until after 2020.
CIC announced on October 8 that it had entered into exclusive negotiations on a take- over by an unnamed “multibillion-dollar conglomerate” which could buy between 51% and 100% of the company, at a nonbinding price of C$7,75 a share.
The October exclusivity agreement followed the announcement about a month earlier that the company had received an indicative proposal “from a multibillion- dollar Indian conglomerate with interests which include coal mining and power generation”.
CIC said last week that it had received a positive fairness opinion on the JSW offer from financial adviser Deutsche Bank Securities, and that the company’s directors and officers of CIC Energy had agreed to enter into lock-up agreements with JSW to tender their shares into the offer.
Under the agreement between the two companies, JSW must launch its offer by December 20, subject to due diligence, no material adverse change and shareholders representing at least 20% of CIC’s outstanding shares, including the officers and directors, having entered into lock-up agreements.
The offer will require government and regulatory approvals and approval by shareholders representing at least two-thirds of CIC Energy shares on a partially diluted basis.
CIC has agreed not to solicit other transactions, and JSW will have the right to match any superior offer. CIC will, under certain circumstances, also pay a break fee of about C$10,5-million if the acquisition is not completed.
News via miningweekly.com by Liezel Hill, 3rd December 2010
Edited by: Martin Zhuwakinyu
JSW gives SACMH shareholders more time to accept its offer
By: Loni Prinsloo, 6th January 2011
JOHANNESBURG (miningweekly.com) – JSW Energy, the independent power arm of rapidly growing Indian group JSW, said on Thursday that it would extend the closing date for the remaining shareholders of South African Coal Mining Holdings (SACMH) to accept its offer to buy their shares.
The company said in a statement that it had agreed with the SACMH board to extend the closing date for its offer to January 21, seeing that most offerees and brokers were still on leave this early in the year.
In May, JSW struck an R85-million agreement with the entities associated with the Royal Bafokeng Tribe and Strider Holdings, which were the major shareholders in SACMH, snatching a controlling interest in the company.
JSW then made a mandatory offer of 30c a share to the SACMH minority shareholders. Subject to certain circumstances, some shareholders may also receive an additional amount if they accept the offer.
SACMH shares had been suspended from trading on the JSE since May 2009 because it had not filed a reviewed provisional report within a stipulated three-month period. The shares were last traded at 41c a share.
Edited by: Mariaan Webb
JOHANNESBURG (miningweekly.com) – JSW Energy, the independent power arm of rapidly growing Indian group JSW, said on Thursday that it would extend the closing date for the remaining shareholders of South African Coal Mining Holdings (SACMH) to accept its offer to buy their shares.
The company said in a statement that it had agreed with the SACMH board to extend the closing date for its offer to January 21, seeing that most offerees and brokers were still on leave this early in the year.
In May, JSW struck an R85-million agreement with the entities associated with the Royal Bafokeng Tribe and Strider Holdings, which were the major shareholders in SACMH, snatching a controlling interest in the company.
JSW then made a mandatory offer of 30c a share to the SACMH minority shareholders. Subject to certain circumstances, some shareholders may also receive an additional amount if they accept the offer.
SACMH shares had been suspended from trading on the JSE since May 2009 because it had not filed a reviewed provisional report within a stipulated three-month period. The shares were last traded at 41c a share.
Edited by: Mariaan Webb
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