LONDON Nyrstar NV has entered into a four-year marketing agreement to supply Noble Group Ltd. with 200,000 tonnes per year of special-high-grade and continuous galvanizing zinc produced by its European smelters beginning Jan. 1, 2014.
Zurich-based Nyrstar will market the remaining 150,000 tonnes per year of European commodity grade zinc itself once its agreement with Baar, Switzerland-based Glencore Xstrata Plc is terminated at year-end, the company said Oct. 1.
The zinc producer announced several senior appointments in September to boost marketing capacity as it was finalizing the deal with Noble (amm.com, Sept. 16).
Under the terms of the deal, Noble will offer Nyrstar a market premium and profit participation for any upside movement, as well as pre-production financing similar to that provided by Glencore, Nyrstar said.
The Hong Kong-based trading house will also purchase a 1-percent stake in Nyrstar for 6.4 million ($8.4 million), a 5-percent premium over its three-day volume-weighted average share price Sept. 27.
"This mutually beneficial multiyear offtake and marketing relationship ... we believe will form the basis for new opportunities for Noble to bring its leading logistics and supply services to zinc metal consumers with the reliable market-leading Nyrstar production," Mark Hansen, Nobles global head of metals, said.
A version of this article was first published in AMM sister publication Metal Bulletin.