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Mozambique: no counterbid from Tata Steel for Riversdale’s coal mines

By on December 28, 2010

Tata Steel hasn’t yet decided on making a counterbid for Riversdale, managing Director H.M. Nerurkar said.“One needs deep pockets for making a bid…we are at present watching the situation closely.” Tata’s statement follows Rio Tinto’s $3.9 billion takeover offer for Riversdale, a company in which Tata Steel already  holds 24% stake. Riversdale, which has 13 billion metric tons in coking and thermal coal reserves in its Mozambique’s holding, is a strategic investment for Tata Steel to meet coking coal needs for both its Indian plant as well as its Anglo-Dutch unit, Corus.  
But possibly,   Tata Steel   wouldn’t be  averse to Rio Tinto’s  bid,  as it considers Rio Tinto “a well-managed company,” Nerurkar,  said on Monday.

Nerurkar said the company is constantly on the look-out for new coking coal mines, but said purchasing mines has become expensive as valuations of such assets are quite high at present, largely due to high Chinese demand.   “We are scouting for mines in Australia, Canada and South Africa. If we get a good proposition, we will certainly consider buying,” he added.

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