Universal Coal offloads stake to Power Origin

16 July 2012 (Last Updated July 16th, 2012 18:30)

Universal Coal has signed an agreement with Power Origin Developments which will bring in direct investment of up to AUD$10m ($10.3m) for a 19.99% stake in the company.

Universal Coal has signed an agreement with Power Origin Developments which will bring in direct investment of up to AUD$10m ($10.3m) for a 19.99% stake in the company.

The transaction will be completed in two tranches of AUD$7m ($7.2m) and AUD$3m respectively, and will be subject to shareholder approval.

Funds secured from the offload of stake to Power Origin Developments will be diverted for the equity requirements of the Kangala thermal project in Australia.

Power Origin's interest in Universal Coal comes in line with its plans to get the Kangala thermal plant, located in Australia, into production and continuing the development of its other coal assets.

Ning Yat Hoi, Power Origin Developments investor, said: "We have been attracted to the team's ability to develop thermal and coking coal assets, and that once funded, the company has the ability to bring these projects into production in ways which brings maximum return to shareholders as demonstrated by the company securing an off take customer for Kangala."