Australias Arrium Ltd. has hired an investment bank to
sell its 50.3-percent stake in New Zealand-listed Steel &
Tube Holdings Ltd.
The Lower Hutt, New
Zealand-based company, which processes and distributes a range
of steel and allied products in the construction, manufacturing
and rural industries, will be sold to institutional and retail
investors at a fixed price of New Zealand $2.05 ($1.70) per
share, Arrium said Tuesday.
The proceeds of approximately
NZ$91.2 million ($74.5 million) will be used to reduce
Arriums debt and gearing levels, it said.
The sale of Steel & Tube
Holdings "reflects further progress with our steel footprint
and product portfolio review, which commenced last year and led
to the earlier sale of our Piping Systems business," Arrium
managing director and chief executive officer Geoff Plummer
said in a statement.
"We are continuing to progress
further opportunities mainly related to our non-integrated
steel businesses," he added.
The Sydney-based company last
week rejected an Australian $1-billion ($1.02-billion) takeover
bid put forward by a consortium led by Hong Kongs Noble
Group Ltd. and Pohang, South Korea-based steelmaker Posco Ltd.
amm.com, Oct. 1).
While the consortium said it
"can make Arrium a more competitive steel producer by improving
production processes, operating efficiency and investment in
technology to lower the cost of production," it is reportedly
more interested in the latters iron ore business.
Arrium currently has an annual
sales capacity of more than 6 million tonnes of iron ore, and
plans to expand that to some 11 million tonnes by mid-2013.