A consortium led by Golden Energy and Resources Pte Ltd has signed a deal for a US$600 million loan from private credit funds, including Davidson Kempner Capital Management LP, to pay for its acquisition of an Australian coal mine, according to people familiar with the matter. 

The loan, signed late last week, backs the Illawarra coking coal mine acquisition and pays around 800 basis points over the secured overnight financing rate, with a tenor of five years, the people said. Other lenders include Farallon Capital Management LLC, King Street Capital Management LP, Washington H Soul Pattinson & Co Ltd, and Broad Peak Investment Advisers Pte Ltd, and sole bank lender Deutsche Bank AG, they said.

Golden Energy’s consortium closed a separate US$150 million working capital loan and another A$150 million (US$100 million) guarantee facility for tapping in the future, according to the people.

Their participation underscores the growing importance of private credit funds in the coal sector in Asia. It’s the latest example of companies with Australian coal operations that are turning to higher interest-rate loans, as global banks increasingly shun commodity-related applicants due to ESG (environmental, social, and governance) concerns.

GEAR M Illawarra Met Coal, the corporate entity that’s acquiring the mine from Australia-based South32 Ltd for US$1.65 billion, mandated Grant Samuel as an adviser in its fundraising efforts, Bloomberg reported in March. Singapore-based Golden Energy, controlled by Indonesia’s Widjaja family, owns a 70% stake in GEAR M Illawarra Met Coal, while M Resources Pty Ltd holds the remaining 30%.

Broad Peak, Davidson Kempner, Deutsche Bank, Farallon, King Street, Washington H Soul Pattinson, Grant Samuel, and M Resources declined to comment. Golden Energy didn’t immediately respond to requests for comment. 

Reuters first reported on the US$600 million borrowing earlier on Monday. 

Sydney-based coal miner Whitehaven Coal Ltd, earlier this year secured a US$1.1 billion loan to buy two mines, attracting 17 private credit lenders and a bank. 

Last month, the Adani Group unit that controls a major Australian coal port obtained a private credit loan of about A$500 million from Farallon Capital Management and King Street Capital Management.

  - Bloomberg