Cliffs said in a press release that it plans to finance the acquisition with cash on hand and the company's $600 million credit facility. By combining the soon-to-be acquired operations with its current coal operations in West Virginia, Alabama and Queensland, Australia, Cliffs estimates 2011 global production capacity of about 9 million tons consisting of about 7 million tons of metallurgical coal and 2 million tons of thermal coal. Cliffs anticipates the newly-acquired assets to generate about $300 million in revenue and $100 million in EBITDA (earnings before interest, taxes, depreciation and amortization) in 2011. The miner expects the assets to help the company generate more than $400 million in revenue and about $175 million in EBITDA in 2012. The transaction is expected to close within 60 days. Cliffs announces the acquisition as miners have manged to negotiate a lower mining "super tax" in Australia. Large miners such as Xstrata and Rio Tinto had threatened to withdraw their investments in the country and had suspended work in protest of the 40% mining tax proposal. But they're now resuming their activities after the Australian government, under the leadership of its new prime minister Julia Gillard, agreed to lower the rate to 30% for coal and iron-ore miners Shares of Cliffs Natural Resources have risen 2.4% to $48.01 in late morning trading, while Rio Tinto American Depository Receipts have jumped 3.9% to $46.05. -- Reported by Andrea Tse in New York Get more stock ideas and investing advice on our sister site, Stockpickr.com. Follow Andrea Tse on Twitter and become a fan on Facebook.
NEW YORK ( TheStreet) -- Global mining and natural resources company Cliffs Natural Resources ( CLF) said Tuesday that it has agreed to buy all of privately-owned INR Energy's coal operations for $757 million.