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Energy plans to buy stake in China's Shunda Mining
Coal company L&L Energy Inc plans to buy at least a 51 percent stake in Shunda Mining Co, including two coal mines and a coal washing facility, in a bid to tap into higher demand for coal and energy in China.
Shares of L&L Energy rose more than 9 percent to $10.15 in early Monday morning trade on Nasdaq before shedding some of the gains to trade at $9.95.
The Seattle-based company said it has entered into a Memorandum of Understanding with Shunda Mining regarding the acquisition.
The two coal mines that L&L Energy plans to buy have a total a production of 750,000 tons per year and the coal washing facility has annual production of 900,000 tons.
L&L Energy is currently performing due diligence regarding the acquisition and expects the acquisition to add to its earnings in the first year.
"We believe with the Shunda's existing mining, coal washing operations, and the anticipated new coking faculties, it will have a dramatic effect on our net income and earnings per share," Chief Executive Dickson Lee said in a statement. (Reporting by Krishna N. Das in Bangalore; Editing by Jarshad Kakkrakandy)
Sourced from www.reuters.com
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