October 08, 2008

ArcelorMittal to buy stake in Coal of Africa

It is reported that the world's biggest steel producer, ArcelorMittal, will buy a 16% stake in South African coal producer Coal of Africa, which has 4 coal mines in South Africa.

Coal of Africa in a statement said that ArcelorMittal will pay around GBP 66.7 million for new shares representing approximately 16% of CoAL's issued capital.

Under the agreement, Coal of Africa will supply ArcelorMittal with a minimum of 2.5 million tonnes per year of coking coal. ArcelorMittal has an option to increase the supply to five million tonnes per year.

ArcelorMittal will also have the right to name one of the directors at Coal of Africa L.