LONDON, UK: BHP Group signed a deal to sell its stake in BHP Mitsui Coal (BMC), a metallurgical coal joint venture in Queensland, to Stanmore Resources for up to $1.35 billion, a news release said.

Stanmore, which is majority-owned by Singapore-listed Golden Energy and Resources, agreed to acquire BHP’s 80% stake in BHP Mitsui Coal, which owns and operates two open-cut metallurgical coal mines in the Bowen Basin.

The remaining stake in BHP Mitsui Coal is owned by Japan’s Mitsui & Co Ltdb.

Stanmore will pay $1.1 billion on completion of the sale and an additional $100 million six months after that. There is a potential for up to $150 million in a price-linked earnout, payable in 2024, the companies added.

Stanmore, which has a market capitalisation of $207.1 million, according to data from Eikon, said it intends to fund the acquisition with a $625 million debt facility and a $600 million equity raising.

The deal still needs to go to Australia’s Foreign Investment Review Board for approval.