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Mitsui & Co. (8031) said it agreed to pay $763 million for stakes in a Mozambique coal project owned by Vale SA (VALE5), signaling confidence from Japan’s second-largest trading house in a recovery in coking coal prices.
The Japanese trader will take a 15 percent stake in the Moatize mine and a 50 percent stake in Vale investment units that have been promoting the rail and port infrastructure around it, Mitsui said in a statement to the Tokyo Stock Exchange.
The company will pay $450 million for the mine and $313 million for the Nacala project that operates the infrastructure, it said.
The southeast African nation is also home to Mitsui’s biggest liquefied natural gas development, which is set to begin producing in 2019.
Vale’s Moatize mine is one of the world’s biggest deposits of coal used for steelmaking. Coking coal prices have fallen 18 percent this year, though they have stabilized in recent months, according to Bloomberg Intelligence analyst Andrew Cosgrove in a Dec. 4 report.
To contact the reporter on this story: Yuriy Humber in Tokyo at yhumber@bloomberg.net
To contact the editors responsible for this story: Jason Rogers at jrogers73@bloomberg.net Peter Langan
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