Pembroke Resources Pty Ltd' Olive Downs sell down looks likely to net more than $1 billion for the private equity firm-backed mining business, according to sources, with two Indonesian-backed bidders battling it out for the asset. Olive Downs is up for sale through investment bank Jefferies Australia, with Pembroke, a business backed by private equity firm Denham Capital Management LP, offloading a 70% stake. DataRoom understands that the sale process is now in the second round, and MACH Energy Australia Pty Ltd., owned by Indonesian conglomerate The Salim Group, and Stanmore Resources Limited, 59% owned by Golden Energy and Resources, which in turn is owned by Indonesian conglomerate Sinar Mas, are the final two contenders.

Stanmore also counts Matt Lattimore's M Resources as a 4.8% holder. The asking price is believed to be more than $1 billion for the stake in Olive Downs, a mine operated by CIMIC-controlled contractor Thiess. Both have a close relationship with Whitehaven Coal, the group that last year bought the Blackwater and Daunia metallurgical coal mines from BHP in a deal worth as much as $6.4 billion.

Some believe Whitehaven would have also been an eager buyer of Olive Downs, but is bedding down its latest deal. Whitehaven also has a sale process running for 20% of Blackwater, with steel producers from Japan and India closing in, including JSW or possibly Mitsui. There's speculation that Mach is shaping as the front runner for Olive Downs, with former hedge fund manager and Whitehaven Coal director Raymond Zage offering financial fire power to its bid.