(EnergyAsia, September 14 2011, Wednesday) — Australia’s MetroCoal said it is selling 32 million shares representing a 15% stake to a leading Chinese coal services groups, DADI Engineering Development Group Co Ltd (DADI), for A$24 million. (US$1=A$0.95).

MetroCoal said the money raised from selling 32 million shares at A$0.75 each will be used to develop its Bundi coal mine, and infrastructure to support mining and logistics infrastructure including its investment in Tenement to Terminal Limited.

The transaction is being undertaken in two tranches, with an initial placement of 3.2 million shares worth A$2.4 million to be sold to DADI (Hong Kong) on an unconditional basis. The remaining 28.8 million shares worth A$21.6 million will be placed on approval by MetroCoal shareholders and Chinese government regulators. The company expects to clear these approvals by late November.

DADI, which specialises in coal mining including open cut and underground coal mine design, coal process plant design and engineering, procurement and construction, will nominate a representative, Wang Dongping, to the MetroCoal board.

The company said Mr Wang has “excellent skills, experience and reputation in the coal sector.”

MetroCoal’s CEO, Mike O’Brien, said:

“The investment by such a highly skilled and experienced coal group is a great vote of confidence in MetroCoal and our key projects.”

DADI chairman Meihua Xie said:

“We are greatly encouraged by the growth that MetroCoal has achieved in its Surat Basin projects. We look forward to contributing to MetroCoal’s continued success.”

With over 2,000 employees, DADI has worked on many significant coal projects including the completion of more than 30 open cut and underground mining projects, the design and supply of over 70 coal processing plants and three water slurry treatment plants.