Coal company braves market turmoil

NEW South Wales coal company Donaldson Coal could brave a listing on the Australian Securities Exchange later this year in a bid to raise $A500 million for expansion works.
Coal company braves market turmoil Coal company braves market turmoil Coal company braves market turmoil Coal company braves market turmoil Coal company braves market turmoil

Underground at Donaldson Coal's Tasman mine.

Vivienne Ryan

A report by news agency Reuters said the Australian miner was looking at different avenues to raise cash for expansion works, including a listing on the ASX as one option.

“Donaldson is considering a number of strategic options as it implements a growth strategy, one of which is an IPO. However, no final or firm decision has yet been made,” a Donaldson spokesman told the news agency.

Donaldson is a privately listed coal mining company with underground and open cut operations in the NSW Hunter Valley.

The company’s namesake Donaldson open cut thermal coal mine is located 23km from the Newcastle port and produces 2.5 million tonnes per annum.

Donaldson’s two underground operations are also located in proximity to Newcastle port, with one mine still in development and believed to have a potential production capacity of 4.5Mtpa.

Hong Kong-based commodities trader Noble Group owns 68% of Donaldson and sells the entire miner’s production in Asia.

With the heightening global financial crisis, which this week saw the downfall of US investment bank Lehman Brothers, a public float is thought to be a brave move.

Share market volatility and dried up cash reserves have made raising funds difficult in the current climate.

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