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| NMDC eyes 6 foreign assets; may buy stake in Brazil mine |
| Press Trust of India / New Delhi Feb 22, 2010, 17:05 IST |
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PSU firm had earlier entered into pact with Ferrous Group, UK, for developing the mine at an investment of $2.5 bn
State-owned NMDC is learnt to be eyeing six overseas properties, including that of UK-based Ferrous Group's Brazilian mines, in which it may pick up 50 per cent stake at a considerable amount.
"The company has so far received presentations regarding six global mining properties, including the Brazilian mines of Ferrous Resources," an official in the know of the development said.
The country's largest iron ore producer had recently entered into a non-disclosure agreement with the Ferrous Group for developing its Brazilian mining project, the official said. The group has properties in the US, Canada and Brazil.
The Brazilian venture would be an integrated mining project, including development of infrastructure like roads and ports to carry the iron ore mined from the deposits. It entails an investment of $2.5 billion.
The investment would be a mix of debt and equity, the official said, adding that the financial details of the deal are yet to be finalised.
When contacted, NMDC CMD Rana Som declined to comment on the proposed venture and maintained, "It has been our firm corporate strategy to acquire properties especially coal, iron ore, rock phosphate, potash and manganese."
According to the official, the companies are aiming to mine 50 million tonnes of saleable iron ore from the two Brazilian mines located near Brasilia with an estimated capacity of about 5 billion tonnes.
In an attempt to expand operations globally, NMDC recently entered into a strategic alliance with companies like Tata Steel, ArcelorMittal and Rio Tinto and is working to finalise a mining deal by the end of 2010.
"At least in three properties, NMDC's internal due diligence teams have been on the spot. I don't see any possibility for the current financial year but we expect it (a deal) by the end of the calender year," another official said.
According to the investment bankers involved, global mining firms are visiting NMDC with JV proposals every week and make presentations on their mineral properties.
Besides, iron ore, the mining major is part of a special purpose vehicle International Coal Ventures Ltd, which is scouting for thermal and coking coal properties abroad.
Moreover, it has already tied up with Rashtriya Fertlisers to acquire rock phosphate properties abroad. It has also entered into an agreement with Kopano KE Matala Investments of South Africa for exploring mineral resources in the country.
The company produced about 28 million tonnes of iron ore in the last financial year and has outlined a capital expenditure of Rs 26,000 crore for the next three to four years.
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