“Rio Tinto Group, the world’s second- biggest mining company, is considering a sale of all or part of its coal business in Mozambique after last week flagging a $3 billion writedown for the assets, a person familiar with the matter said.
The London-based company has begun a review of the assets acquired in 2011 for A$3.9 billion ($4.1 billion) with the purchase of Riversdale Mining Ltd. and all options are being examined, the person said, declining to be identified because the information is private. The person said no timetable has been set for the completion of the review.
The Australian Financial Review reported today that Rio was conducting a review of its Mozambique coal business, to examine export transport options, potential joint ventures or asset sales, citing unnamed sources.
Chief Executive Officer Tom Albanese and head of strategy Doug Ritchie, who led the acquisition of Riversdale, stepped down last week after Rio (RIO) said it would book charges totaling $14 billion. The company said the Mozambique asset writedown was unacceptable, citing transport constraints and a cut to recoverable coking coal estimates.
Rio will also assess options of boosting coal exports by co-operating with potential parties on rail and port infrastructure, the person said. Other companies with coal mines near Rio’s in the Moatize Basin include Vale SA (VALE3) and Anglo American Plc. (AAL)…”
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