The M Res HCC metallurgical coal joint venture will see M Resources partner JSW Steel take on an additional interest in the project.
The Indian steelmaker has executed binding agreements to increase its interest to 83.3 per cent, up from 66.7 per cent currently, which follows on from the launch of the joint venture in August last year.
JSW Steel will now spend a total of $US60 million in aggregate consideration for the increased stake.
It has promised to purchase non-voting Class B shares from an entity owned by M Resources for $US24 million. This will represent a 4 per cent economic interest in Golden M NSW, which fully owns Illawarra Coal Holdings through a subsidiary.
JSW Steel will further subscribe for additional non-voting Class B shares to be issued by M Res NSW for consideration of $US36 million. This will be used by M Res NSW to purchase an additional 6 per cent stake in the Golden M project from Golden Energy and Resources, taking its share to 36 per cent.
M Resources founder and president Matt Latimore said the complete set of transactions would see JSW Steel increase its exposure to the Illawarra coal industry.
“JSW understands the strategic nature of the Illawarra in the global seaborne metallurgical coal market and these transactions allow Illawarra Metallurgical Coal the opportunity to play a greater part in that vision,” he said.
“The partnership structure enables M Resources to continue to benefit from the asset’s performance while providing JSW with the security of an increased economic interest, which is aligned with their strategic growth objectives.
“We look forward to our continued partnership with JSW and exploring additional opportunities where our combined capabilities can create mutual value.”
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