JSW Steel to acquire stake in Australia’s M Res NSW

Leading Indian steel producer JSW Steel has announced that it will acquire almost 67% of the shares of an Australian private company for $120 million in order to expand its coal reserves. This is reported by Mining Technology.

It is about buying a stake in M ​​Res NSW, a subsidiary of coal company M Resources. This year, the latter, together with Singapore’s Golden Energy, purchased the Illawarra metallurgical coal mining business from Australia’s South32 – the deal will be completed in September of this year.

Following the acquisition of the shares, JSW Steel, either directly or through its subsidiaries, intends to enter into a market contract for the purchase of coking coal from Illawarra Metallurgical Coal.

Illawarra’s assets include two coking coal mines in New South Wales, Australia, with total commodity reserves of high-grade raw material of 99 million tonnes. Over the past 5 years, these mines have produced an average of approximately 6.5 million tonnes of coal per year.

In a statement to the press, the Indian steel company said that the key priority for it remains the provision of raw materials and cost optimization. This acquisition is a step forward in achieving these goals.

The acquisition will be completed by the Indian company subscribing to non-voting Class B shares in M ​​Res NSW for an initial investment of $120 million. In addition, the terms require JSW Steel to further inject $50 million into M Res NSW for deferred consideration payable in 2030.

As GMK Center reported earlier, JSW Steel plans to invest $1 billion in the decarbonization of capacities. This will contribute to the company’s ambition to become carbon neutral by 2050 and reduce CO2 emissions by 42% (1.95 t CO2 per tonne of steel) by 2030