Rio Tinto sells small South African coal assets
Rio Tinto has agreed to sell two small coal assets in South Africa, the latest move by the global mining giant to up stakes and divest from the country.
Forbes & Manhattan Coal said on Tuesday it would pay 440 million rand ($53,21 million) for the two coal assets.
Rio Tinto is also divesting from South Africa’s largest copper producer Palabora Mining Company but has no buyer a year after putting the 57,7% stake on the market.
Rio Tinto spokesman David Outhwaite said the scale of the coal assets being sold were simply too small for its portfolio.
The company is not completely abandoning South Africa and doubled its stake in Richards Bay Minerals earlier this year, a producer of titanium dioxide.
But policy uncertainty and a wave of violent strikes in the platinum sector this year have unnerved foreign investors.
Forbes Coal said the acquisition will boost its total production by 39% to 2,5 million tonnes a year.
Forbes Coal is taking a 74% interest in the Zululand Anthracite Colliery, a producing anthracite mine, and 74% in the Riversdale Anthracite Colliery (“RAC”), an undeveloped mine. The remaining 26% stakes in each asset are in the hands of black economic empowerment partners.