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UPDATE 1-South Africa's Exxaro buys Total's coal assets for $472 mln
July 28, 2014 / 3:30 PM / 3 years ago

UPDATE 1-South Africa's Exxaro buys Total's coal assets for $472 mln

* Exxaro says deal to raise its coal portfolio by 12 pct

* Says deal gives it extra RBCT capacity allocation (Adds more details, Exxaro CEO comments)

JOHANNESBURG, July 28 (Reuters) - Mining group Exxaro Resources said on Monday it had acquired the South African coal assets of France’s Total for $472 million, bolstering its output and giving it extra capacity at the world’s largest export terminal.

Exxaro, South Africa’s second-largest coal producer which also has interests in iron ore and base metals, signalled earlier this year that it was looking at buying Total Coal South Africa (TCSA).

“The acquisition increases the scale of Exxaro’s coal portfolio by about 12 percent,” Exxaro Chief Executive Sipho Nkosi said on a conference call.

Exxaro currently has seven coal mines that produce about 40 million tonnes annually. The company’s biggest domestic customer is South African power utility Eskom and it also produces coal for export.

Exxaro said the deal will give it extra capacity allocation at South Africa’s Richards Bay Coal Terminal, the world’s largest export coal terminal, allowing it to export more.

Nkosi said the company’s allocation at the terminal will double to 8 million tonnes as soon as the acquisition is completed.

TCSA is the fifth-largest coal producer in South Africa and the majority of its output is exported to Asian markets such as India and China.

The deal will be financed with Exxaro’s existing corporate debt facilities, the company said.

Total said in a statement the sale was part of the group’s asset sale programme for 2012 through 2014 as it focuses on its core activities.

Exxaro shares were up 2 percent at 144.17 rand as of 1450 GMT. (Reporting by Olivia Kumwenda-Mtambo; Editing by Ed Stoddard and David Holmes)

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