Glencore to Sell Australia Rail Unit to Genesee & Wyoming for A$1.14 Billion
20 Outubro 2016 - 4:52AM
Dow Jones News
By Rhiannon Hoyle
SYDNEY--Glencore PLC (GLEN.LN) has agreed to sell its
coal-haulage business in Australia's New South Wales state to U.S.
railroad operator Genesee & Wyoming Inc. (GWR) for 1.14
billion Australian dollars (US$874 million), the latest sale by the
company aimed at reducing its debt load.
Glencore last year had promised to sell operations to cut
borrowings after a mounting debt pile and sagging commodities
prices sent its shares tumbling. The company has since agreed to
carve off parts of its business including a 40% stake in its
agricultural business which it sold to Canada's largest pension
fund, Canada Pension Plan Investment Board, for US$2.5
billion in cash.
"The sale of the GRail business forms another significant
part of Glencore's debt-reduction program," the commodities
trader and mining company said in a statement Thursday.
Glencore said that after the deal is completed Genesee &
Wyoming, based in Darien, Conn., would manage much of Glencore's
coal-transport in the country's Hunter Valley region under a
20-year contract.
GRail, also known as Glencore Rail, currently hauls about 40
million metric tons of Glencore's coal output from mines in the
Hunter Valley to the Port of Newcastle, the world's biggest
coal-export hub, each year.
"We established GRail in 2010 and have steadily grown it to
become the third largest coal haulage business in the country,"
said Peter Freyberg, head of Glencore's global coal assets. "It
has played a very important role in reducing costs and improving
the overall efficiency of Australia's largest coal chain in the
Hunter Valley."
The deal will need approval by Australia foreign-investment
regulator, the company said.
Genesee & Wyoming already has operations in Australia,
including running more than 3,000 miles of track in South Australia
state and the Northern Territory, according to its website.
Write to Rhiannon Hoyle at rhiannon.hoyle@wsj.com
(END) Dow Jones Newswires
October 20, 2016 02:37 ET (06:37 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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