CIL board clears stake acquisition in unlisted overseas firms
Coal India’s (CIL) board of directors has approved a proposal for the mining firm to acquire stakes in unlisted firms overseas, provided the “offers were valid”.
The decision was taken in a meeting of the company board yesterday.
The development comes in the wake of Finance Ministry approval last month for the public sector firm to go-ahead with a buyout of overseas firms that are unlisted.
“It was decided during the board meeting that if the offers were valid then they can be evaluated by Coal India,” a top official with Coal India privy to the development said.
“The company will take up three offers — in Australia,Indonesia and the US,” the official said.
The PSU has put together a war-chest of Rs 6,000 crore for acquisition of mines.
The Finance Ministry last month gave permission to the company to go ahead with its plans to acquire unlisted firms overseas.
On CIL’s request for a relaxation in the PSU guidelines stipulating a minimum 12 per cent internal rate of return (IRR) on investments, the Finance Ministry had said the company can proceed with such proposals if they are of strategic nature, but these will have to be cleared by the government.
CIL had also sought to sidestep the rule that only the mines of listed companies should be acquired, which was permitted by the Finance Ministry.
The world’s largest coal miner has zeroed in on three unlisted overseas coal assets for acquisition. It had sought clarifications from the Finance Ministry before entering into serious dialogues with owners, having received proposals offering an IRR between 9 per cent and 12 per cent.