Energy-focused company Mercator Ltd. is in final stages of talks to sell its entire interest in Indonesian coal mines as it looks to reduce debt, two people aware of the negotiations told BloombergQuint requesting anonymity.
The company holds stakes in two mines—Petangis and Batuah—in the Southeast Asian nation through its subsidiary Oorja Holdings Pte. The stake sale is likely to fetch close to $150 million (about Rs 1,000 crore), one of the two people quoted above said.
BloombergQuint's emailed queries to Mercator remained unanswered.
The company plans to reduce a large portion of its long-term debt through the proceeds of the sale, the person said. It had a total long-term debt of Rs 1,416 crore as of March, according to an exchange filing.
Net debt stood at Rs 1,708 crore. Mercator had said in an investor presentation that it plans to reduce its net debt to around Rs 1,400 crore by March 2018. It also indicated plans to monetise the coal assets.
The company reported a revenue of Rs 1,146 crore and a profit before tax of Rs 174 crore for the coal mining business, one of its most profitable segments.
Mercator started as a shipping company and has in the last decade diversified into oil and gas exploration and coal mining.
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