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The proposed merger of India NRE Minerals (INM) and Gujarat NRE Resources (GNR) will take place through a scrip offer by INM for all the issued shares of GNR.
GNR currently controls the Avondale coal mine, near Wollongong and the adjacent Elouera mine - while INR controls the NRE No.1 colliery (formerly South Bulli and Bellambi).
"The timing is right to bring the two companies together and create a stronger company with the ability to take a prominent position in the Australian and global hard coking-coal market," Gujarat NRE Coke vice chairman and managing director Arun Jagatramka said.
Three INM will be offered for every four GNR shares, which values the merged company at about $A480 million based on INM's closing price on August 30.
The Indian parent company holds a 90.83% interest in INR and 71.52% in GNR.
The merger is expected to completed by November 2007.
