Bids to acquire two coal mines that BHP is seeking to offload in Queensland, Australia could be financed with the help of large loans of between $3bn and $4bn from private credit funds, according to a report by Bloomberg.
The report cites unnamed sources familiar with the matter as revealing that the funds are in talks to potentially underwrite financing for competing bids for the Daunia and Blackwater mines from Indonesian mining contractor Bukit Makmur Mandiri Utama Pt (Buma) and Australian coal producer Stanmore Resources Ltd.
Buma and Stanmore have reportedly made initial bids for at least one of the mines with a deal for both assets expected to be valued at around $5 billion. The reminder of the financing would come from traditional lenders.
Stanmore already has a private credit track record having secured $625m in financing from funds managed by Varde Partners, Canyon Capital Advisors, Farallon Capital Asia Pte, and others, to partially fund its acquisition of BHP’s 80% stake in a coal operation joint venture with Mitsui & Co in Bowen Basin, Queensland.
