The Australian
BHP Billiton to merge its struggling nickel and aluminium units
Edited by : AL CIRCLE
2 min read
BHP Billiton plans to merge its struggling nickel and aluminium units to make them big enough to remain within the mining giant, in a clear signal it is not planning to sell either outright.
But the prospect of further sales or closures of individual nickel and aluminium assets remains.
Yesterday BHP said it would merge its stainless steel materials and aluminium groups into a new business headquartered in Perth.
The two businesses recently came under the control of BHP's corporate development boss Alberto Calderon, fuelling earlier speculation they would be put up for sale.
At the time, chief executive Marius Kloppers also said BHP would probably exit some businesses and assets over the next decade as they became too small to exist within the growing miner.
But yesterday, Mr Calderon said the two commodities would remain within BHP.
"Despite the current challenges, BHP Billiton is committed to aluminium and nickel as commodities that may benefit from later phases of economic development in the emerging economies," he said.
Aluminium and nickel are small divisions relative to the other businesses in BHP.
"The combination of these into a single business unit will provide appropriate scale within the BHP Billiton portfolio."
While this seems to rule out a sale of either business for now, there has been no change to Mr Kloppers' reluctance to support any asset that is losing cash.
The new business will be run by Glenn Kellow, who recently replaced new BHP iron ore boss Jimmy Wilson as head of BHP's stainless steel materials.
Mr Kellow previously ran the Nickel West business, acquired in 2004 when BHP bought WMC Resources.
BHP's nickel assets are in Western Australia and Colombia, while its aluminium assets are in WA, Mozambique, South Africa and Brazil.
In the six months to December 31, its aluminium arm logged a $US67 million ($66m) underlying loss before interest and tax, while nickel made a profit of just $1m.
But the prospect of further sales or closures of individual nickel and aluminium assets remains.
Yesterday BHP said it would merge its stainless steel materials and aluminium groups into a new business headquartered in Perth.
The two businesses recently came under the control of BHP's corporate development boss Alberto Calderon, fuelling earlier speculation they would be put up for sale.
At the time, chief executive Marius Kloppers also said BHP would probably exit some businesses and assets over the next decade as they became too small to exist within the growing miner.
But yesterday, Mr Calderon said the two commodities would remain within BHP.
"Despite the current challenges, BHP Billiton is committed to aluminium and nickel as commodities that may benefit from later phases of economic development in the emerging economies," he said.
Aluminium and nickel are small divisions relative to the other businesses in BHP.
"The combination of these into a single business unit will provide appropriate scale within the BHP Billiton portfolio."
While this seems to rule out a sale of either business for now, there has been no change to Mr Kloppers' reluctance to support any asset that is losing cash.
The new business will be run by Glenn Kellow, who recently replaced new BHP iron ore boss Jimmy Wilson as head of BHP's stainless steel materials.
Mr Kellow previously ran the Nickel West business, acquired in 2004 when BHP bought WMC Resources.
BHP's nickel assets are in Western Australia and Colombia, while its aluminium assets are in WA, Mozambique, South Africa and Brazil.
In the six months to December 31, its aluminium arm logged a $US67 million ($66m) underlying loss before interest and tax, while nickel made a profit of just $1m.
Previous article
Century Aluminum Company files Quarterly Report for 2012-03-31
Next article3-Month Price of LME primary aluminum falls 1.2%
Grow with
AL Circle
