LONDON BHP Billiton Plc has chosen Citigroup Inc. to
help it investigate the possibility of selling its Temco
manganese alloys smelter in the Australian state of Tasmania, a
source familiar with the situation said.
Speculation that the London-based mining company might sell
some of its manganese assets grew earlier this year as a result
of a document put together by Melbourne, Australia-based Orion
Corporate Advisory Services.
Orions document highlighted the possibility that the
mining company might be interested in divesting part or all of
its manganese business in order to shift its focus toward its
core large, low-cost, scalable businesses such as copper, iron
ore and coal.
But Orion was acting independently of BHP and was seeking to be
appointed financial adviser to a potential acquirer of the
business. New York-based Citibanks role is different, in
that it has been given a clear mandate by BHP, the source
They have appointed Citi to find them a buyer, but only
for the sale of Temco, the source said.
Another source said BHP is not under pressure to sell any part
of its business and suggested that no final decisions have been
made about Temco.
BHP Billiton shut Temco in February, but restarted it after
signing a new power deal, cutting costs and concluding that the
smelter was viable (
amm.com, May 22).
The smelter produced 267,000 tonnes of manganese alloy in 2011,
up from 219,000 tonnes in 2010.
Earlier this year, Rio de Janeiro-based Vale SA sold its
European manganese alloy smelters to Baar, Switzerland-based
Glencore International Plc.
BHP declined to comment. Citi did not respond to a request for
A version of this article was first published by AMM sister
publication Metal Bulletin.