/ 21 April 2008

ArcelorMittal to buy stake in SA coal producer

The world’s biggest steel producer, Luxembourg-based ArcelorMittal, will buy a 16% stake in South African coal producer Coal of Africa (CoAL), CoAL said in a statement on Monday.

ArcelorMittal will pay £66,7-million for new shares “representing approximately 16% of CoAL’s issued capital”, the statement said.

Under the agreement, CoAL 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.

CoAL owns four coal mines in South Africa. ArcelorMittal has 310 000 employees in 60 countries and produced 116-million tonnes of steel in 2007, or about 10% of total global production. — AFP