Wesfarmers Limited (ASX: WES) informed the market that it has agreed to sell its Bengalla Joint Venture stake of 40% to its JV partner New Hope for the total consideration of $860 million. On successful completion of the transaction, the group expects to report a pre-tax profit on the sale of $670 million to $680 million subject to completion adjustments. The group will continue to get benefited from earnings and cashflow from its interest in Bengalla until completion of the transaction.
As of now, Bengalla is owned 40% by the Wesfarmers, 40% by New Hope, 10% by Taipower and 10% by Mitsui. The transaction is subject to regulatory approval and pre-emption rights under the Bengalla JV Deed. Following completion of the transaction which is anticipated to occur in late 2018, New Hope will own up to an 80% interest in the Bengalla Joint Venture. Bengalla has the approval to produce up to 15 million tonnes of thermal coal, which is used in energy production and for export to Japan and North Asia.
With this news, the stock edged up 0.04 per cent and traded at $49.960 with the market-cap of circa $56.62 Mn as on August 07, 2018 (AEST – 03:30 P.M.).
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