This article is 15 years old. Images might not display.
Lanco revealed it was successful in the bidding war over the debt-laden coal company in a Bombay Stock Exchange announcement yesterday.
Lanco chief financial officer Suresh Kumar said he was excited about the future prospects for Griffin.
"The acquisition of Griffin Coal is an important component of our development strategy, providing increased fuel security for our current power generation assets and future power portfolio expansions,” he said.
“This acquisition also presents an opportunity to Lanco to participate in the burgeoning natural resources trading market.
“We are committed to expanding Griffin Coal's export capacity and making a significant contribution to the Collie community and South West region more broadly.”
While the exact figures of the deal were not announced, The Australian newspaper reported that Lanco’s Australian subsidiary paid $800-850 million for the successful bid.
Under the management of KordaMentha since it entered voluntary administration in January with more than $1.8 billion of outstanding debt, Collie-based Griffin started making export shipments to India.
Back in September, Construction Forestry Mining and Energy Union WA’s secretary of mining and energy Gary Wood revealed the company was producing about 1 million tonnes per annum of export coal and about 2.7Mtpa for the domestic market.
The coal is railed through to Kwinana’s port for export, but Wood said there was full support from the state government and the Bunbury Port Authority for the development of Berth 14.
Depending on the level of investment, Wood indicated the company could possibly ramp up saleable production to 4-7Mtpa.
Griffin employs about 470 workers and operates the Ewington and Muja mines 220 kilometres southeast of Perth.
KordaMentha partner Brian McMaster lead the sales process of the company and reportedly told Bloomberg that Griffin’s bondholders might get more than 80c in the dollar, with a payment near the end of the March quarter.
Griffin used to be run by former coal tycoon Ric Stowe and the business had more than $1 billion of debt associated with the Bluewaters Power Station.
