UPDATE: Anglo American To Sell Moly-Cop, AltaSteel For $932 Million
15 November 2010 - 2:26AM
Dow Jones News
Anglo American PLC (AAL.LN) said Sunday that it agreed to sell
its Moly-Cop and AltaSteel operations to Australia's OneSteel Ltd.
(OST.AU) for $932 million on a debt and cash free basis, as the
company continues its divestment program to focus on what it sees
as its core commodity assets.
In October last year, Anglo American announced plans to focus on
platinum, copper, nickel, coal and iron ore. The announcement to
hone in on its key commodities followed attempts by rival Xstrata
PLC (XTA.LN) to merge the two companies and market speculation that
the miner remained vulnerable to further takeover attempts.
"Following the $1.3 billion divestment of our Zinc portfolio in
May 2010, the sale of Moly-Cop and AltaSteel represents further
strategic progress as we continue to focus on our core commodity
businesses and on the delivery of our major near-term growth
projects," said Chief Executive Cynthia Carroll.
Anglo American said Sunday it continues to progress with its
divestment program "in a manner and to a timetable that maximizes
value to its shareholders," including the sale of the Scaw Metals
Group based in South Africa.
Moly-Cop and AltaSteel were part of the larger Scaw Metals
Group.
The miner sold its zinc portfolio in May to Vedanta Resources
PLC (VED.LN).
OneSteel (OST.AU), an Australia-based manufacturer and
distributor of steel and finished steel products, said the
acquisition is important for the company's future growth in mining
consumables.
Moly-Cop is based in Chile and its facilities include the
ability to convert steel bars into grinding balls for use in mine
milling circuits. AltaSteel is based in Edmonton, Canada and is a
vertically-integrated steel mini-mill.
In the first half of 2010, the businesses recorded $319 million
in revenue and for the whole of 2009 they made $642 million in
revenue.
Anglo American is geographically focused around platinum in
South Africa, copper in Chile, nickel in Brazil, metallurgical coal
in Australia, thermal coal in South Africa, subsidiary Kumba Iron
Ore Ltd. in South Africa and other iron ore in Brazil.
Anglo American is in the process of doubling its Brazilian iron
ore capacity but he company is behind schedule because of
difficulty with environmental licensing, analysts have said.
Completion of the Moly-Cop and AltaSteel transaction is
conditional on antitrust clearance in Canada and it will undergo
regulatory review in Australia and Brazil, Anglo American said.
-By Devon Maylie, Dow Jones Newswires; +44 20 7842 9483;
devon.maylie@dowjones.com
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