Vedanta group acquires Goa mining company in Rs.17.50 bn deal

June 12th, 2009 - 12:41 am ICT by IANS  

Panaji, June 11 (IANS) Goa’s biggest family-owned mining company, the Dempo group, has sold all its mining assets to Sesa Goa Limited, a majority-owned subsidy of the London-listed Vedanta Resources, for Rs.1,750 crore (Rs.17.50 billion/$368 million) in an all-cash deal.
Addressing the media in Panaji late Thursday evening, chairman and managing director of the Dempo group, Srinivas Dempo, said that the 19 iron ore mines in Goa controlled by the V.S. Dempo mining corporation, had 70 million tonnes of iron ore reserves with a lease life of approximately 17 years, “making it an ideal time to monetize their Goa mining assets”.

“We have only sold our Goa mining assets, but have retained our other mining interests in Sindhudurg, Maharashtra. It was a good time to sell our Goa assets and use the monies to focus on larger mining interests elsewhere, both within the country and overseas,” he said.

Srinivas Dempo, a scion of one of Goa’s leading business families, which has been in the mining business for the last 50 years, said that the Dempo group would also use the new infusion of cash in other sectors such as education, media, food processing, shipbuilding, etc.

Under the present agreement, the assets which have been taken over by Sesa Goa are the Dempo group’s mining rights to 19 leases in Goa and related infrastructure such as barges, jetties, transshippers and berthing facilities at the Mormugao port.

In 2008-09, the Dempo group exported 4.36 million tonnes of ore and reported revenues to the tune of Rs.976 crore.

The Dempo group currently has four long term contracts with steel mills in China, Japan and Hong Kong. The group’s other interests include coke, pig iron production, real estate and construction, football, education and the media.

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