South Korean group exits $324 million deal with Cockatoo Coal
A South Korean conglomerate has cited global economic uncertain as a key reason for pulling out of a US$324 million deal with Australia-based Cockatoo Coal.
SK Networks said today it will not proceed with the investment in Cockatoo:
"SK Networks has informed the company that the decision was based on prioritization of investment opportunities and investment requirements contemplated by SK Networks and the ongoing uncertainty in global markets," Cockatoo Coal (ASX:COK) said in a statement. Shares in the ASX-listed company dropped 7.25% on the news.
Cockatoo's flagship Baralaba operation restarted production in May of 2011 after the central pit was flooded in December 2010- with output of around 50,000 tonnes per month.
The Australian quoted CLSA analyst James Stewart saying the company will almost certainly be looking for more capital to fund capex demands of between $350 million and $400 million.
SK's Resources & Energy division is involved in oil & gas trading, coal trading, and resource development- particularly coal and non-ferrous metals, according to the company's website.