KEPCO to buy Aussie coal firm stake for A$17 mln

SEOUL, Oct 11 (Reuters) - Korea Electric Power Corp (015760.KS) and a unit company have signed a A$17 million preliminary contract to buy a stake in Australia's Cockatoo Coal Limited (COK.AX), the Korean companies said on Thursday.

Under the deal, KEPCO and Korea East West Power Co Ltd will be given the preemptive right in securing a minimum 2 million tonnes of bituminous coal a year from Cockatoo-owned mines in the future.

KEPCO and its unit will own 40 million new shares to be issued by Cockatoo, totalling a 10 percent stake in the Australian company.

"KEPCO's participation in Cockatoo's rights offering is meaningful in that it contributes to securing power-generating fuel on a stable basis," it said in a statement.

The agreement is subject to shareholder approval.

The SK Group and Korea Resources Corp each hold 5.43 percent stakes in Cockatoo, while POSCO Co Ltd (005490.KS) owns 20 percent of the Australian mine specializing company.