Fortescue, Apollo Bid for $1.5 Billion Wesfarmers MinesBy , , and
Australian conglomerate selling Curragh, Bengalla coal assets
Purchase would help Fortescue expand beyond iron ore
Apollo submitted an indicative offer for Wesfarmers’s stakes in the Curragh and Bengalla mines by a deadline around the end of last month, the people said, asking not to be identified because the information is private. Fortescue bid for Curragh, which produces mostly metallurgical coal, according to the people. The suitors are now studying detailed information on the assets, which could fetch as much as A$2 billion ($1.5 billion) combined, the people said.
Wesfarmers, the Australian retail-to-fertilizer conglomerate, started a sale process for the mines after prices for coking coal soared last year. Any purchase by Fortescue, the world’s fourth-biggest iron ore exporter, would further the company’s goal of expanding into other commodities to diversify its revenue sources.
Representatives for Apollo, Fortescue and Wesfarmers declined to comment.
Wesfarmers fully owns the Curragh mine in Queensland’s Bowen Basin, an asset that can produce about 8.5 million metric tons of metallurgical coal and 3.5 million tons of thermal coal a year, according to the Wesfarmers website. The company also holds 40 percent of the Bengalla thermal coal mine, which is located in New South Wales state’s Hunter Valley and can supply as much as 10.7 million tons a year.