| ||
| ||
| ||
 |
|
|
|||||||||||||||||||||||||||||||||||||||||||||||
BHP quits Argentina mine stake
SYDNEY, Australia (CNN) -- BHP Billiton, the world's biggest diversified resources group, said Wednesday it is selling its 25 percent stake in the Alumbrera copper and gold mine in Argentina for $180 million. The buyer is Canada's Wheaton River Minerals Ltd. Wheaton said in a statement it would take 12.5 percent, with another party holding 12.5 percent at arm's length. "Wheaton River will finance its 12.5 percent with debt and does not anticipate issuing additional equity," the company said. Wheaton already has a 25 percent stake in Alumbrera, which it bought from global resources group Rio Tinto earlier this month for $210 million in a deal that included the Peak gold mine in New South Wales, Australia. The other 50 percent of Alumbrera is held by Australian miner and operator MIM Holdings. Alumbrera is Argentina's biggest copper-gold mine and is a major low-cost producer. Wheaton said the acquisition would cut its average cash gold cost from $124 an ounce to below $100 an ounce. For BHP, the sellout is seen as a positive for the company, which has been rationalizing non-core operations since its merger with Billiton in 2001. BHP said it has agreed to defer up to $50 million of the purchase price until May 2005, with the deferred portion bearing interest at 2 percent above the prevailing London InterBank Offered Rate (LIBOR). The sale is by BHP's fully owned subsidiary, Rio Algom. BHP said it expected to close the deal, which is subject to regulatory approvals, in June. BHP's share of production from Alumbrera for the year to June 2002 was 48,500 tonnes of copper contained in concentrate and 193,000 ounces of gold. Before the BHP deal, Wheaton River said it was the eighth largest Canadian gold producer with projected 2003 output of 458,500 gold equivalent ounces (371,000 gold ounces and 6.4 million silver ounces) at a projected cash cost of $124 per gold equivalent ounce. The company said the purchase of an additional 12.5 percent stake in Alumbrera would lift 2003 annualized production to 538,000 gold equivalent ounces and would cut the estimated cost per gold equivalent ounce to $99. BHP Billiton shares finished 0.86 percent higher in Australia at A$9.40 on Wednesday, below a 1.32 percent gain for the wider market. Rio Tinto put on 0.68 percent to A$32.65 and MIM added 7.64 percent to A$1.55, after it confirmed it was continuing talks with potential suitor Xstrata. There is speculation that if Swiss-based Xstrata makes a successful bid for MIM, it could dispose of the Alumbrera stake to concentrate on MIM's other operations, such as its extensive coal export business. That could give Wheaton the opportunity to buy the remaining 50 percent of Alumbrera.
|
|
|||||||||||||||||||||||||||||||||||||||||||||||
|
|
