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Ispat To Acquire Coalmines In Colombia Mozambique and Brazil

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Ispat Industries is all set to acquire coal and iron ore mines in Colombia, Mozambique and Brazil. This move is in bid to secure raw materials for its expansion.

Global Steel Holdings, the holding company of Ispat Industries, has signed lease agreements in these three countries for iron ore, coking and thermal coal.

Three special purpose vehicles will be created to own the mining rights. The broad contours of the plan suggest that Global Steel Holdings will retain the majority stake while Ispat will pick up 20-30 percent in each of these SPVs.

The combined holding of the group will be around 70-80 percent while the remaining minority stake will be held by local partners.

The size of the equity contribution could not be ascertained. Industry sources said the initial equity contribution will not be much. It will take a while to gauge the total investment for mining.

Source:ET

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Tags: global steel, industry sources, iron ore mines, ispat industries, thermal coal