Calcutta, India, 9 Dec – India’s Tata Steel may partner an Indian metallurgy or mining company to present a proposal to acquire Australia’s Riversdale Mining, following a US$3.5 billion offer from Rio Tinto, the Indian press reported.

Citing sources close to the process, the Indian press said that Tata Steel planned to acquire a controlling stake in the Australian company, which has two coal concessions in Mozambique and has become a target for large international mining companies, such as Anglo-American and Rio Tinto.

Tata Steel has a 24 percent stake in Riversdale, and is one of the company’s main shareholders, and according to investment bank Bombay Ambit Capital, it may have to spend over US$1 billion to get a 51 percent stake.

Due to the high cost of this operation, Tata Steel is likely to partner state Indian mining company NMDC, which previously showed interest in acquiring 10 percent of Riversdale, or SAIL (Steel Authority of India Ltd), with which Tata Steel has an agreement to survey for raw materials.

Riversdale Mining’s assets include the Benga and Zambeze projects in Mozambique’s Tete province, which have estimated coal reserves of 4 billion tons.

Tata Steel has a 35 percent stake in the Benga project and the remaining 65 percent is in the hands of Riversdale Mining. In January 2010 China’s Wuhan Iron & Steel signed a memorandum of understanding to acquire an 8 percent stake in Riversdale Mining and 40 percent of the Zambeze project. (macauhub)