Arrium recap and sales process to be completed by year-end
Arrium's mining consumables business incorporates Moly-Cop, which will be put up for sale.
JOHANNESBURG (miningweekly.com) – The recapitalisation and sale of collapsed Australian mining and steel group Arrium’s assets would be largely completed by the end of the year, the company’s administrator reported on Monday.
The recapitalisation and sales process would start in July and was expected to attract “genuine interest” from local and international businesses.
Arrium’s main assets include the steelworks, port and mining operations at Whyalla; its mining supplies unit Moly-Cop, which is the largest manufacturer and supplier of grinding media to mining operations globally; and OneSteel Manufacturing and Distribution, which is a steel products supplier.
Administrator KordaMentha Restructuring stated that a global investment bank would be appointed shortly to advise on the sale of Moly-Cop, which was Arrium’s most profitable business.
Arrium bought Moly-Cop in 2010 from global diversified major Anglo American and last year tried to sell the business. The board cancelled the sales process after offers were not considered high enough.
KordaMentha said it had started preparing the necessary materials that interested parties would require to conduct due diligence studies. These included an information memorandum, audited financial statements for 2016, budgets for 2017 and a comprehensive data room with relevant up-to-date information.
The administrator reported that some organisations had already contacted KordaMentha to register their interest in Arrium's businesses.
Arrium entered into voluntary administration in April, after lenders rejected a $927-million recapitalisation plan.
The South Australian government has established a steel task force to identify opportunities for restructuring and co-investment to secure the long-term future of the Whyalla steel operation.
Analysis by Flinders University shows that South Australia will lose about A$750-million and 5 000 jobs if the Whyalla operation is closed.
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