(Reuters) - Wesfarmers Ltd (WES.AX) said on Friday it would sell its Curragh coal mine in Queensland to Texas-based Coronado Coal Group for A$700 million ($539 million).
Coronado Coal is owned by Texas-based private equity group The Energy & Minerals Group.
The deal also included a provision through which Wesfarmers would receive 25 per cent of Curragh’s export coal revenue generated above a realized metallurgical coal price of $145 per tonne.
The revenue would be paid quarterly over the next two years, Wesfarmers added.
Wesfarmers expected to report a post-tax profit of about A$100 million on the sale, the Australian retail-to-mining conglomerate said in a statement, adding the strategic review of its 40 percent stake in the Bengalla coal mine, which is also up for sale, is ongoing.
Earlier this year Wesfarmers’ plans to exit the mining business was given a blow when a group comprising two U.S. private equity firms ended their pursuit of the Curragh asset.
The pair was bidding only for the Curragh mine and their offer was lower than $500 million, sources had said. Wesfarmers wanted a total of roughly $1.5 billion for the two mines, sources added.
Curragh was acquired by Wesfarmers for approximately A$200 million in 2000, the company said.
Reporting by Rushil Dutta in Bengaluru; Editing by Hugh Lawson and Chris Reese