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Billiton to raise $750m and increase gearing
Billiton is to raise $750m through the issue of shares to the market and will increase its net debt to $3bn in order to pay for recent acquisitions. This will increase its gearing to 68% compared to gearing of 30% at 30 Jun 00.
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Billiton acquires 56% of Worlsey Alumina
Billiton has acquired 56% of Worlsey Alumina (Australia) from Alcoa for $1.49bn. Billiton already owns 30% of the project and Japanese steel companies Kobe Aluminium and Nisho Iwai the remainder. These two companies have pre-emptive rights on a proportionate part of Alcoa's 56% stake, which calculates to 17.82%, and a decision on whether they will exercise this right is expected shortly.
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Billiton to acquire Rio Algom Ltd
Billiton and Rio Algom Ltd, a Toronto based mining and metals distribution company, have reached an agreement whereby Billiton will offer to acquire the entire issued capital of Rio Algom for C$27.00 per share or a total consideration of C$1.7bn. This is a 49% premium over the closing price of Rio on 21 Aug 00 and a 10% premium over the offer price of C$24.50 made by Noranda Inc on 22 Aug 00. The offer is subject to acceptance by holders of 66.67% of the Rio issued capital. The Rio board has unanimously recommended the agreement. The acquisition will provide Billiton with a significant entry point into the global copper business and a vehicle for future development of other base metal opportunities. Billiton has the right to match any subsequent offers and has a break free fee agreement of US$45m.
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Billiton's Samancor to cut capacity
Billiton and Anglo owned ferrochrome producer Samancor is to cut local smelting capacity by about 10% through the closure of two furnaces, which could result in the loss of 300 jobs at its ferrometals division. The furnaces are being closed due to the failure of their linings which has resulted in a dip in performance, as well as a spike in the nickel price, a major ingredient in stainless steel, which has caused a reduction in demand for stainless steel.
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Billiton signs Chilean biotech agreement
Billiton has signed a 50/50 joint venture agreement with Corporacion Nacional del Cobre de Chile to establish a new biotechnology company called Alliance Copper Ltd, which will develop and explore biologically based technologies for the processing of copper and molybdenum ores and concentrates. Alliance Copper will invest $200m over the next six years, funded equally by both parties, starting with the construction of a $40m prototype bioleach facility in Chile, with an output of approximately 20 000 tonnes per annum, to asses the commercial application of the technology.
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| Closing price data source: JSE Ltd. All other statistics calculated by ProfileData. |
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