Indonesian coal giant Adaro Energy is a latecomer to the auction for Rio Tinto's $2.5 billion-plus Queensland coal portfolio.
It is understood that Adaro will bid for the whole portfolio in a joint offer with Owen Hegarty's resources private equity house EMR Capital.
EMR is expected to retain control of the bidding consortium, however sources said Adaro would not be a silent investor. The Indonesian coal company is expected to take a 49% stake in the assets, should its group win the auction, in what would be its first major Australian investment.
Adaro is bidding via one of its Malaysian entities, Adaro Capital, which is ultimately owned by the Indonesian-listed Adaro Energy, which has a $6.4 billion market capitalisation and reported more than $1.5 billion in earnings before interest, tax, depreciation and amortisation for the year to December 31.
Binding bids are due to Rio Tinto's adviser Credit Suisse on March 12, following a five-month auction.
Rio Tinto is expected to receive a handful of offers. It is understood the EMR/Adaro consortium will come up against ASX-listed Whitehaven Coal, US-based Coronado Coal and a bid put together by private equity firm Apollo Global Management, among others.
Bidders expect it could be some weeks before a deal is signed given the multiple assets up for sale, associated joint venture agreements and the number of bidders.
Rio Tinto is offering controlling stakes in two existing coal mines (Kestrel and Hail Creek) and two undeveloped coal assets (Winchester South and Valeria) in Queensland's Bowen Basin. Hail Creek and Kestrel together produced 7.7 million tonnes of hard coking coal, used to make steel, for Rio Tinto last year, topped up by a smaller amount of thermal coal.
(Writing by Becky Du Editing by Tammy Yang)
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