Coal India (CIL) might be planning to set up a subsidiary for the purpose of acquiring coal assets South Africa through forming a joint venture with a local partner.

The Indian public sector unit was approached by the government of the South African state of Limpopo to form a joint venture (JV) with one of its public sector firms for acquiring coal mines in the province. Limpopo is the northernmost province of South Africa.

According to a CIL official, the joint venture might be formed between the public firm of Limpopo and a subsidiary of CIL. The official also said that the Chief Minister of Limpopo Government had approached the Indian company back in June requesting it t form a joint venture with a local government run firm in the state.

CIL is likely to have a majority share in the joint venture while the local firm will have at least 26 per cent share. The Limpopo government has reportedly already given a draft memorandum of agreement on the proposal to CIL.

The Indian state run unit has set aside Rs 6,000 crore for acquisition of mines and he Finance Ministry had given its approval for the acquisition of unlisted overseas firms.