Australian conglomerate Wesfarmers has confirmed it’s gauging market interest in its coal assets, but says no decision has yet been made as to whether or not it will sell.
Significant improvements in the spot prices of metallurgical and thermal coal in recent months have led to media speculation over whether Wesfarmers, which operates in the commodities, retail, and industrial sectors, will seize the opportunity to sell its Australian coal assets for a good price.
Multiple sources contributed to the speculation, including Bloomberg, which reported last week the Perth-based company had sent preliminary information to potential bidders for the Curragh and Bengalla mines in Queensland and the Hunter Valley, respectively.
It’s thought Wesfarmers could sell its coal assets for as much as $2 billion.
The company addressed the speculation in an ASX statement on November 15.
“Wesfarmers notes media speculation regarding a potential sale of all or part of its coal assets,” the company said.
“Wesfarmers has previously disclosed that it is evaluating all strategic options for the Resources business with a view to maximising shareholder value.
“Wesfarmers is continuing to consider a broad range of options, from operational to divestment initiatives, including recently seeking expressions of interest from external parties who may want to acquire the coal assets.
“There is no certainty this process will lead to a transaction and Wesfarmers will update the market further if and when appropriate.”
Wesfarmers announced it would review options for its resources unit in August, when the outlook for coal was looking significantly more challenging.