BHP won’t sell more spinoff assets

Published Nov 24, 2014

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Johannesburg - BHP Billiton won’t sell any more assets set aside for a $15 billion (R165 billion) spinoff after today’s disposal of an aluminum casthouse in South Africa.

“We’re not talking to other people about adding or subtracting to the portfolio, we’re very focused on getting the demerger done,” BHP chief financial officer Graham Kerr, who will head the spinoff planned for the first half, said in an interview.

“To get the regulatory approvals and paperwork done in the timeframe you’re talking about you can’t afford to keep chop-and-changing what’s in and what’s out.”

Hulamin, South Africa’s biggest maker of aluminum products, said today it and a group of companies will buy the casthouse at BHP’s Bayside smelter in the northeastern port of Richards Bay for an undisclosed figure.

The transaction was “an exception,” Kerr said in Johannesburg.

BHP, the world’s largest mining company, said in August it plans to spin off 12 assets across countries from Australia to South Africa.

The new company may be worth about $15 billion when listed and become mining’s biggest spinoff in at least a decade, according to CLSA Asia-Pacific Markets.

While the South Africa’s Hillside smelter was set aside for inclusion in the spinoff, the Bayside smelter was earmarked to close.

The new entity would prioritise existing assets before embarking on new deals, Kerr said.

The company “will look at some of the internal brownfield options we have in terms of existing operations that we can grow,” he said.

“Then over time you would like to think of things that you can add.”

BHP will provide full details by March before a vote on the plans, and a name for the company probably by the year-end, Kerr said.

Ricus Grimbeek, head of BHP’s Worsley operations, was named president and chief operating officer for the spinoff’s Australian assets and will be based in Perth.

Mike Fraser gets the same position in Africa, based in Johannesburg, BHP said in a separate statement.

Fraser is BHP’s human resources president. - Bloomberg News

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