Consolidation of the international coal industry has continued with Swiss-based commodity house Glencore International poised to increase its 23% holding in South Africa's Duiker Mining.
Producing 20 million tonnes of coal per annum, the company is South Africa's third largest exporter of coal after Billiton and Anglo American.
Owner of the group, London based Lonmin has signed a conditional deal to sell its coal assets to Glencore for R1.325 billion ($A330 million). The assets include a 61% stake in Tweefontein United Collieries and a 62% stake in Duiker.
Capitalised at R1.9 billion, Duiker was generally seen as undervalued. The 21% export quota (13.5mtpa) held at Richards Bay coal terminal is believed to be a major attraction.
Duiker owns nine collieries, anthracite mines and a gold mine. Duiker also owns a 16% stake in the Douglas-Tavistock joint venture managed by Billiton Coal.
In September, Duiker was one of the South African exporters who made a bit to secure market share in the Asian region by reportedly offering to sell coal for as low as $US20 per tonne.
Glencore also holds substantial coal producing assets in Australia's Hunter Valley, including the Mt Owen, Cumnock and West Wallsend mines. Total Australian production amounts to 13.5Mtpa.
