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BlueScope Steel to Divest its Taharoa Iron Sands Business
08/26/2008 - BlueScope Steel Limited announced the sale of its New Zealand iron sands mining and export operation, the Taharoa Iron Sands Business, to Cheung Kong Infrastructure Holdings Limited.
BlueScope Steel Limited announced the NZ$250-million sale of its New Zealand iron sands mining and export operation, the Taharoa Iron Sands Business, to Cheung Kong Infrastructure Holdings Limited.
New Zealand Steel operates two iron sands mining operations, Taharoa and Waikato North Head, through its subsidiary, New Zealand Steel Mining Limited (NZSM). Although the company is selling its Taharoa mining operation, which is a purely export-focused business, it will keep the Waikato North Head, which is integral to its steelmaking operations at Glenbrook.
"The sale generates a strong financial return for BlueScope Steel and reflects the current high world demand for iron ore,” said BlueScope Steel Managing Director and CEO Paul O'Malley, when announcing the transaction. “We are pleased with the financial outcome from this transaction.”
New Zealand Steel operates two iron sands mining operations, Taharoa and Waikato North Head, through its subsidiary, New Zealand Steel Mining Limited (NZSM). Although the company is selling its Taharoa mining operation, which is a purely export-focused business, it will keep the Waikato North Head, which is integral to its steelmaking operations at Glenbrook.
"The sale generates a strong financial return for BlueScope Steel and reflects the current high world demand for iron ore,” said BlueScope Steel Managing Director and CEO Paul O'Malley, when announcing the transaction. “We are pleased with the financial outcome from this transaction.”
"I commend the employees of Taharoa who have, over a number of years, run this very successful business,” continued O'Malley. “Their work has underpinned the significant value of the asset. I also commend the significant efforts of employees and management at New Zealand Steel in developing a successful business model and mine expansion strategy.”
The company said that BlueScope Steel remains committed to the ongoing development of its New Zealand business and is retaining ownership of its primary iron sands mine at Waikato North Head. The Waikato North Head mine supplies New Zealand Steel’s steelmaking operations and is a strategic component of the overall New Zealand platform. The Waikato North Head mine has ample reserves to provide for current and future steelmaking at New Zealand Steel, and together with its dedicated employee group is a key component of New Zealand Steel’s future.
The sale, which is expected to be completed by the fourth quarter of calendar 2008, is subject to conditions including New Zealand Overseas Investment Office approval.
Merrill Lynch acted as financial advisor to BlueScope Steel on the sale and Chapman Tripp as its legal counsel.
New Zealand Steel is a wholly owned subsidiary of international steel company, BlueScope Steel Limited. The company is a global leader in the provision of high quality metallic coated and painted steel solutions to the building and construction sector, and it also supplies customers in the general manufacturing and automotive sectors.
BlueScope Steel, formerly known as BHP Steel, is now known as BlueScope Steel as a result of its demerger from BHP Billiton. The company provides employment opportunities to over 20,500 people at 114 manufacturing sites in 17 countries around the world.
The Taharoa Iron Sands Business is a dedicated export business based 200 km south of Auckland on the west coast of New Zealand’s North Island. The Taharoa Iron Sands Business mines and exports iron sand to steel producers in China and Japan. Currently it employs 40 full time staff and exports approximately 850kt of iron sand per annum. In the year ended June 30, 2008, the Taharoa Iron Sands Business reported revenue of approximately NZ$53m and EBITDA of approximately NZ$16.7m.
The Taharoa Iron Sands Business is owned and operated by NZSM and was acquired by BlueScope Steel (BHP at the time of the acquisition) as part of the acquisition of New Zealand Steel from the New Zealand Government in 1992. The transaction will be a sale of shares in NZSM. Prior to the sale of NZSM, the Waikato North Head operations, including all associated assets and liabilities, will be transferred to the New Zealand Steel group.
The company said that BlueScope Steel remains committed to the ongoing development of its New Zealand business and is retaining ownership of its primary iron sands mine at Waikato North Head. The Waikato North Head mine supplies New Zealand Steel’s steelmaking operations and is a strategic component of the overall New Zealand platform. The Waikato North Head mine has ample reserves to provide for current and future steelmaking at New Zealand Steel, and together with its dedicated employee group is a key component of New Zealand Steel’s future.
The sale, which is expected to be completed by the fourth quarter of calendar 2008, is subject to conditions including New Zealand Overseas Investment Office approval.
Merrill Lynch acted as financial advisor to BlueScope Steel on the sale and Chapman Tripp as its legal counsel.
New Zealand Steel is a wholly owned subsidiary of international steel company, BlueScope Steel Limited. The company is a global leader in the provision of high quality metallic coated and painted steel solutions to the building and construction sector, and it also supplies customers in the general manufacturing and automotive sectors.
BlueScope Steel, formerly known as BHP Steel, is now known as BlueScope Steel as a result of its demerger from BHP Billiton. The company provides employment opportunities to over 20,500 people at 114 manufacturing sites in 17 countries around the world.
The Taharoa Iron Sands Business is a dedicated export business based 200 km south of Auckland on the west coast of New Zealand’s North Island. The Taharoa Iron Sands Business mines and exports iron sand to steel producers in China and Japan. Currently it employs 40 full time staff and exports approximately 850kt of iron sand per annum. In the year ended June 30, 2008, the Taharoa Iron Sands Business reported revenue of approximately NZ$53m and EBITDA of approximately NZ$16.7m.
The Taharoa Iron Sands Business is owned and operated by NZSM and was acquired by BlueScope Steel (BHP at the time of the acquisition) as part of the acquisition of New Zealand Steel from the New Zealand Government in 1992. The transaction will be a sale of shares in NZSM. Prior to the sale of NZSM, the Waikato North Head operations, including all associated assets and liabilities, will be transferred to the New Zealand Steel group.
