GVK set to buy Hancock Coal

After months of intense negotiations and competitive bidding, Hyderabad-based GVK group has been shortlisted to acquire Hancock Coal. GVK and Hancock had entered into an exclusive arrangement for negotiations that would continue till the middle of next month.
GVK will have to make an initial payment of $1.3 billion (Rs 5,798 crore) or show its capability to do so within the exclusivity period. It would have to follow it up with similar payments of $1.3 billion each over the next three to four years towards equity.  Over and above the $4 billion equity, GVK will have to pay another $4 billion as debt and mining development costs over the next six years, taking the total deal size to around $8 billion. To organize the initial funds, GVK has approached some foreign and Indian banks such as Standard Chartered and ICICI. Three banks are likely to take an exposure of around $420 million each.