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Eurasia Natural Resources is a Kazakhstan based natural resources company with operations in exploration, mining, processing, power generation, logistics and marketing. The company has a strong focus on Iron Ore, Bauxite, Ferroalloys and Manganese.
Eurasian Natural Resources snaps up 25% stake in thermal coal producerFebruary 16 2009, 9:18am
Eurasian Natural Resources Corporation (LSE: ENRC) announced that it had acquired a 25% stake in Shubarkol Komir JSC, a Kazak thermal coal producer, for US$200 million in cash. Shubarkol Komir produced approximately 6.1 million tonnes of coal in 2007, making it one of the largest producers in Kazakhstan, and has around 1.4 billion tonnes of measured and indicated coal resources.
The acquisition is considered a related party transaction, as three of the founding shareholders of Eurasian Natural Resources hold a majority stake in Shubarkol Komir.
As part of the acquisition, Eurasian Natural Resources has also entered into an off-take agreement, and has a call option to acquire all or part of the remaining shares at the same price it paid for the 25% stake.
Dr. Johannes Sittard, Chief Executive Officer of ENRC, said, 'The acquisition of Shubarkol provides for the further strategic development of the Group in the region. In addition, it strengthens the integrated business model of ENRC through securing a reliable and cost effective supply of relatively high quality thermal coal and semi-coke, thereby further enhancing the Group's position as a low cost producer.'