Insight
Adaro and EMR diversify into Australian metallurgical coal with US$2.25 billion Kestrel acquisition
Report summary
On 27 March, Adaro Energy and EMR Capital announced they had jointly agreed to purchase Rio Tinto's 80% interest in the Kestrel coking coal mine in Queensland for US$2.25 billion in cash. The total consideration payable by Adaro and EMR may rise up to US$2.81 billion should Mitsui decide to exit its 20% interest for up to US$563 million. In this insight, we assess the metrics of the deal and strategic rationale of all parties involved.
Table of contents
- Overview
-
Deal summary
- Kestrel
- Deal analysis
- Strategic rationale, upside and risks
Tables and charts
This report includes 9 images and tables including:
- Deal summary
- Location map
- Summary valuation
- Valuation metrics
- Economic assumptions
- Adaro and EMR's bid signals further recovery in deal-implied benchmark hard coking coal prices
- Adaro pro-forma production profile - metallurgical coal (attributable)
- Seaborne metallurgical coal total cash cost curve 2018 (US$/tonne)
- Marketable reserves (1 July 2018)
What's included
This report contains:
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