JOHANNESBURG Jan 9 (Reuters) – Shares in
Australia-listed African Iron Ltd. rose more than 9
percent on Monday after an online report that South African
diversified miner Exxaro was in talks to buy the iron
ore company.
A spokesman for Exxaro declined to comment on the Wall
Street Journal report, but a source at Investec, a
South African bank which was said to be advising on the
transaction, admitted a deal was in the works.
African Iron’s flagship asset is the Mayoko Iron Ore project
in the Republic of Congo. It is expected to start production in
2013 at a rate of 5 million tonnes per year, according to the
company’s website.
Exxaro, South Africa’s second-largest coal producer and a
major supplier to power utility Eskom, is scouting Africa and
Australia for projects to expand into other commodities,
especially iron ore and even copper.
Its $130 million bid for Australia’s Territory Resources was
trumped by Noble Group last year, but Exxaro said it
remained keen to buy iron ore assets and eventually produce 10
million tonnes of the steel-making ingredient a year.
Shares in Exxaro were down 2.07 percent at 172.84 rand by
1408 GMT, compared with a 0.26 percent rise in the JSE Top-40
blue-chip index.
(Reporting by Agnieszka Flak; Editing by Ed Cropley)
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