Eike Batista agreed to sell coal projects in Colombia to Turkey’s Yildirim Holding AS for about $450 million as the former billionaire sells assets and scales back operations in a bid to keep his commodities group afloat.
Under a preliminary agreement, CCX Carvao da Colombia SA, Batista’s coal unit, will sell its Canaverales and Papayal open-pit mines to Yildirim for about $50 million, the company said in a regulatory filing late yesterday. It also agreed to negotiate the sale of its San Juan undeground mine and logistics project for about $400 million, CCX said.
The deal is worth more than four times CCX’s market value, which was 233.1 million reais ($106.7 million) as of yesterday’s close. The stock rose 4.4 percent to 1.43 real at 11:39 a.m. in Sao Paulo, reducing a year-to-date drop to 31 percent.
Batista, who ceased being a billionaire in July, this year sold stakes in energy, logistics and mining ventures as he seeks to raise cash to pay back debt amid a collapse in the price of his assets. OGX Petroleo & Gas Participacoes SA, the tycoon’s oil company, could file for bankruptcy protection as soon as today, said a person with direct knowledge of the plans.
CCX expects to close the sale of Canaverales and Papayal by the end of the year after a Sept. 13 agreement to sell the mines to Transwell Enterprises Inc. expired, the company said in yesterday’s filing. The sale of the San Juan project is expected to be concluded by the end of April, the company said. Yildirim will make a $5 million payment to negotiate the purchase of the Colombian mines in exclusivity, it said.
While Canaverales holds 27.3 million metric tons of coal reserves and Papayal’s reserves amount to 15.6 million tons, the flagship San Juan underground mine has 671.8 million tons in reserves and an associated logistics project, CCX said.
Batista, 56, created Rio de Janeiro-based CCX in May 2012 through a spinoff from his power generation unit MPX Energia SA, targeting 35 million tons of thermal coal output by 2020 from its three mines. The company estimated in an August 2012 filing that developing its San Juan project would require $5.5 billion, including costs to start production in 2017 and achieve full capacity five years after that.
CCX, the last of the six units listed by the tycoon between 2006 and 2012, may be worth as much as $6 billion, Batista said in 2011.
Shares of the company gained 171 percent from a record low on July 3 through Sept. 13, on speculation CCX would sell assets. The stock jumped 21 percent to 1.37 reais at the close in Sao Paulo yesterday, the most since Aug. 21.