Gremach acquires 75% stake in 11 coal mines in Mozambique; share up 5%

MUMBAI: Gremach Infrastructure Equipments & Projects shares soar 5 per cent on news that the company has taken 75 per cent controlling stake in 11 coal mine licenses in Mozambique aggregating 13,520 hectares in Moatize.

At 11:20 AM, the share was locked at its upper circuit at Rs 266.60, up 5 per cent from its previous close.

“This region falls in Karoo basin which is recognized as prime hard coking coal bearing area in Africa. There is a global shortage and crisis of hard coking coal and this will add huge value to the profitability of the company,” Gremach said in a notice to BSE.

Gremach plans to begin prospecting the area in October, which will be completed by mid 2008. The licenses have been purchased from Mozambique’s Osho Mozambique Coal Mining Limitada.

"These 11 licences are very close to existing Companhia Vale do Rio Doce mines and few of them have common boundary with CVRD licences where hard prime coking coal has already been found. These strategic acquisitions will make Gremach one of the most important players in prime hard coking coal mine in the world," Rishi Raj Agarwal, MD of the company said.