Fri, 09 Mar 2012
ET reported that TATA Power, Reliance Power, ArcelorMittal, Jindal Steel and Power and Monnet Ispat & Energy are among 60 companies that face risk of cancellation of mining licenses for being slow in exploration of coal blocks.
A review committee headed by coal ministry's additional secretary Ms Zohra Chatterjee has recommended issuing 'show-cause notices' for 58 blocks asking for reasons why mining licenses should not be revoked. A coal ministry official said appropriate action would be initiated against companies that are not able to justify the delay.
The official said that "We are reviewing allotment to non-serious companies that are simply sitting on the blocks. Some allottees are yet to start any activities on the site. Some blocks are delayed due to problems in land acquisition, delayed regulatory clearances, local agitation and law and order issues.”
The companies include Hindalco Industries, TATA Sponge, Electro Steel Casting, MMTC, National Aluminium Co Ltd and power and mining utilities of Jharkhand, Orissa, Andhra Pradesh, Chhattisgarh, Madhya Pradesh and Tamil Nadu.
Coal ministry's latest review found that only 29 of 195 allotted coal blocks have started production while progress at 90 blocks was found dissatisfactory as critical milestones like acquisition of land, forest clearances and execution of mining lease were not achieved for various reasons.
Captive mines are expected to generate just about 36 million tonnes by this fiscal against targeted 81 million tonnes, scaled down from 104 million tonnes after mid-term review by the Planning Commission.
Caution notices will be issued to about 28 companies, including National Thermal Power Corporation, Steel Authority of India, Jai Prakash Associates, Jindal Steel & Power and GVK Power, for slow progress at 32 blocks.
The committee has also advised owners of another 58 blocks to follow up aggressively with the environment ministry for securing clearances. The committee also recommended de-allocation of two lignite blocks.
The government has till date revoked mining licenses for 23 captive coal blocks that were later allotted to Coal India Ltd.
Source - Economic Times
Showing posts with label Arcelor Mittal. Show all posts
Showing posts with label Arcelor Mittal. Show all posts
Friday, March 9, 2012
Friday, February 10, 2012
Tata Steel sees India sales rising, Europe volatile
Fri Feb 10, 2012
* Sees first two quarters in FY13 to be weak for Europe
* Expects 1 mln T additional India sales in FY13
* Shares rebound 4 pct after sliding initially
MUMBAI, Feb 10 (Reuters) - Tata Steel, the world's No. 7 steelmaker, expects demand recovery in its key European market to be volatile, but is hopeful the situation may improve in the second half of the coming fiscal year that begins in April, a top official said.The company, which operates two-thirds of its global capacity in Europe, on Thursday posted its first quarterly loss in more than two years, as prices there fell sharply on the back of weak demand.
"The feeling is, in Europe, FY12/13 will be a mirror image of FY11/12 ... the first two quarters may be weaker than the last two," Chief Financial Officer Koushik Chatterjee said in a conference call with analysts on Friday. Tata Steel's consolidated margins slumped to 5.9 percent in the December quarter from 11.6 percent a year earlier. Prices fell about $43 a tonne on average in the quarter as the European debt crisis impacted decisions of buyers.
Earlier this month, ArcelorMittal, the world's largest steelmaker, posted an unexpected quarterly net loss , while Korea's POSCO, the world No 3, reported a smaller-than-expected profit rise. "Recovery in Europe will be very volatile. For next year, we will be keeping our target at the current year's production level," Chatterjee said. Tata Steel, which mothballed a hot strip mill in south Wales in December, is operating only two of four blast furnaces at Scunthorpe in England.
Last month the company said it would cut 200 jobs at four European plants as part of a restructuring of its European steel tubes business.
INDIA BOOST
The steelmaker, however, expects additional sales of one million tonnes in 2012/13 in India, as new capacity is added at its facility in Jamshedpur in the eastern state of Jharkhand. Tata Steel will complete a planned expansion of its Indian capacity to 9.7 million tonnes by March from 6.7 million tonnes now, Chatterjee said.
Sales at its Indian operations, which account for a quarter of its global capacity of 28 million tonnes, rose 16 percent during the December quarter, and the company expects demand to improve in coming quarters as interest rates ease and investment picks up. Shares in the company, valued at about $9 billion, initially fell 4 percent on the unexpected quarterly loss. They later rebounded on hopes the company's margins have bottomed out and are likely to recover in coming quarters.
At 12:41 p.m. (0711 GMT), the shares were up 4.2 percent in a Mumbai market down 0.5 percent. The stock lost 50 percent of its value in 2011, but has recovered nearly 40 percent so far in 2012 with foreign funds among the big buyers.
(sourced Reuters.com)
* Sees first two quarters in FY13 to be weak for Europe
* Expects 1 mln T additional India sales in FY13
* Shares rebound 4 pct after sliding initially
MUMBAI, Feb 10 (Reuters) - Tata Steel, the world's No. 7 steelmaker, expects demand recovery in its key European market to be volatile, but is hopeful the situation may improve in the second half of the coming fiscal year that begins in April, a top official said.The company, which operates two-thirds of its global capacity in Europe, on Thursday posted its first quarterly loss in more than two years, as prices there fell sharply on the back of weak demand.
"The feeling is, in Europe, FY12/13 will be a mirror image of FY11/12 ... the first two quarters may be weaker than the last two," Chief Financial Officer Koushik Chatterjee said in a conference call with analysts on Friday. Tata Steel's consolidated margins slumped to 5.9 percent in the December quarter from 11.6 percent a year earlier. Prices fell about $43 a tonne on average in the quarter as the European debt crisis impacted decisions of buyers.
Earlier this month, ArcelorMittal, the world's largest steelmaker, posted an unexpected quarterly net loss , while Korea's POSCO, the world No 3, reported a smaller-than-expected profit rise. "Recovery in Europe will be very volatile. For next year, we will be keeping our target at the current year's production level," Chatterjee said. Tata Steel, which mothballed a hot strip mill in south Wales in December, is operating only two of four blast furnaces at Scunthorpe in England.
Last month the company said it would cut 200 jobs at four European plants as part of a restructuring of its European steel tubes business.
INDIA BOOST
The steelmaker, however, expects additional sales of one million tonnes in 2012/13 in India, as new capacity is added at its facility in Jamshedpur in the eastern state of Jharkhand. Tata Steel will complete a planned expansion of its Indian capacity to 9.7 million tonnes by March from 6.7 million tonnes now, Chatterjee said.
Sales at its Indian operations, which account for a quarter of its global capacity of 28 million tonnes, rose 16 percent during the December quarter, and the company expects demand to improve in coming quarters as interest rates ease and investment picks up. Shares in the company, valued at about $9 billion, initially fell 4 percent on the unexpected quarterly loss. They later rebounded on hopes the company's margins have bottomed out and are likely to recover in coming quarters.
At 12:41 p.m. (0711 GMT), the shares were up 4.2 percent in a Mumbai market down 0.5 percent. The stock lost 50 percent of its value in 2011, but has recovered nearly 40 percent so far in 2012 with foreign funds among the big buyers.
(sourced Reuters.com)
Tuesday, January 17, 2012
ArcelorMittal to expand Brazil ore output by 65pct
Tuesday, 17 Jan 2012
Valor Economico citing Mr Sebastiao Costa Filho Chief Executive Officer as saying that ArcelorMittal Brazilian unit plans to increase iron-ore output by 65% in its two mines in the state of Minas Gerais to 7.1 million tons in 2013 from 4.3 million tons this year.
(Sourced from Valor Economico)
Valor Economico citing Mr Sebastiao Costa Filho Chief Executive Officer as saying that ArcelorMittal Brazilian unit plans to increase iron-ore output by 65% in its two mines in the state of Minas Gerais to 7.1 million tons in 2013 from 4.3 million tons this year.
(Sourced from Valor Economico)
Thursday, November 17, 2011
Falling European steel production affecting iron ore volumes from Brazil
Thursday, 17 November 2011
Europe’s current economic woes are weighing heavily on the steel industry. Tata Steel is closing a facility in Wales, while ArcelorMittal has idled and closed a number of European mills and furnaces. ArcelorMittal’s chief financial officer says that it is aiming for a global production capacity of around 71% in Q4, and that they are seeing “more drops in shipments in Europe than in North America.” The impact of lower steel output in Europe is already being felt in the seaborne market. Brazil exported 4.7 MT of iron ore to Europe last month, a 12.2% year-on-year decline. In the years before the 2008 recession, around 30% of Brazil’s iron ore exports went to Europe. After plummeting in 2009, demand recovered enough last year to bring Europe’s share back up to around 20%. Based on the current slowdown in European import demand, however, it is possible that both the volume and share of Europe’s iron ore imports from Brazil will be lower than in 2010.
Source: ICAP Shipping
Europe’s current economic woes are weighing heavily on the steel industry. Tata Steel is closing a facility in Wales, while ArcelorMittal has idled and closed a number of European mills and furnaces. ArcelorMittal’s chief financial officer says that it is aiming for a global production capacity of around 71% in Q4, and that they are seeing “more drops in shipments in Europe than in North America.” The impact of lower steel output in Europe is already being felt in the seaborne market. Brazil exported 4.7 MT of iron ore to Europe last month, a 12.2% year-on-year decline. In the years before the 2008 recession, around 30% of Brazil’s iron ore exports went to Europe. After plummeting in 2009, demand recovered enough last year to bring Europe’s share back up to around 20%. Based on the current slowdown in European import demand, however, it is possible that both the volume and share of Europe’s iron ore imports from Brazil will be lower than in 2010.
Source: ICAP Shipping
Peabody Energy on path to full Macarthur Coal acquisition
Thursday, 17 November 2011
St. Louis, Missouri-based Peabody Energy, the world's largest private-sector coal company, announced Wednesday that its subsidiary PEAMCoal Pty Ltd has acquired over 90 percent of all of the shares of Australian metallurgical coal producer Macarthur Coal. By acquiring 90 percent of the shares, PEAMcoal is compulsorily able to purchase the remaining shares.
Other shareholders such as South Korea's POSCO, which owns a 7.25 percent stake, will be forced to sell its shares to Peabody. The purchase price will also increase to A$16.25 (US$16.39) per share, up from A$16.00 (US$16.14) per share--Peabody had previously agreed to increase its offer price per share if it was able to acquire a 90 percent stake.
Tags: Met Coke , Korea S. , USA , Australia , Korea , Macarthur Coal , POSCO , raw mat , East Asia and Pacific , Oceania , Far East , North America , mining , M&A
Sourced:SteelOrbis
St. Louis, Missouri-based Peabody Energy, the world's largest private-sector coal company, announced Wednesday that its subsidiary PEAMCoal Pty Ltd has acquired over 90 percent of all of the shares of Australian metallurgical coal producer Macarthur Coal. By acquiring 90 percent of the shares, PEAMcoal is compulsorily able to purchase the remaining shares.
Other shareholders such as South Korea's POSCO, which owns a 7.25 percent stake, will be forced to sell its shares to Peabody. The purchase price will also increase to A$16.25 (US$16.39) per share, up from A$16.00 (US$16.14) per share--Peabody had previously agreed to increase its offer price per share if it was able to acquire a 90 percent stake.
Tags: Met Coke , Korea S. , USA , Australia , Korea , Macarthur Coal , POSCO , raw mat , East Asia and Pacific , Oceania , Far East , North America , mining , M&A
Sourced:SteelOrbis
Tuesday, November 15, 2011
Peabody Energy nearing full control of Macarthur Coal
Tuesday, 15 Nov 2011
Peabody Energy's USD 4.9 billion bid for Australian coking coal miner Macarthur Coal is inches away from completion after the world's largest private sector coal miner said it had acquired 87.8% of the shares in Macarthur.
The move gets Peabody within reach of the 90% level at which it can forcibly buy out remaining minority shareholders in Macarthur and the offer price rises automatically to USD 16.25 a share from USD 16 per share.
The bid for Macarthur has not been without complication late last month, European steelmaker ArcelorMittal pulled out of a joint deal with Peabody to take over Macarthur.
ArcelorMittal said at the time that the deal required it to invest too much capital in a business it wouldn't fully control.
The bid continued, however, with ArcelorMittal to sell its interest to Peabody.
Days before ArcelorMittal's announcement, the pair's bid vehicle, PeamCoal, took a majority stake in Macarthur, after having launched the USD 4.9 billion bid.
ArcelorMittal said in a statement at the time that "Given the unanticipated level of acceptances into the offer, ArcelorMittal believes that it is more appropriate to focus its capital elsewhere in its business.”
(Sourced from AAP)
Peabody Energy's USD 4.9 billion bid for Australian coking coal miner Macarthur Coal is inches away from completion after the world's largest private sector coal miner said it had acquired 87.8% of the shares in Macarthur.
The move gets Peabody within reach of the 90% level at which it can forcibly buy out remaining minority shareholders in Macarthur and the offer price rises automatically to USD 16.25 a share from USD 16 per share.
The bid for Macarthur has not been without complication late last month, European steelmaker ArcelorMittal pulled out of a joint deal with Peabody to take over Macarthur.
ArcelorMittal said at the time that the deal required it to invest too much capital in a business it wouldn't fully control.
The bid continued, however, with ArcelorMittal to sell its interest to Peabody.
Days before ArcelorMittal's announcement, the pair's bid vehicle, PeamCoal, took a majority stake in Macarthur, after having launched the USD 4.9 billion bid.
ArcelorMittal said in a statement at the time that "Given the unanticipated level of acceptances into the offer, ArcelorMittal believes that it is more appropriate to focus its capital elsewhere in its business.”
(Sourced from AAP)
Friday, November 4, 2011
ArcelorMittal CEO Mr LN Mittal sees a long way to go for steel plant in India
Friday, 04 Nov 2011
BS reported that ArcelorMittal said the company still has a long way to go in India before it takes a final view on the construction of the proposed steel plants.
Mr LN Mittal president & CEO of ArcelorMittal while declaring Q3 results did not sound very enthusiastic about the progress of the company in India.
In a select media call, he said “We have got mining leases & licenses, which are in different stages of progress. Some are prospecting licenses, some are exploration, but we haven't got mining operation approvals yet.”
He said the mining allocations to ArcelorMittal were done long before so there was some progress.
He told “But it's still a long way to go before we take a final view on construction.”
The company has been eyeing countries like Brazil and India for expansions and its growth drivers in newer markets. However, the market uncertainties have forced it to cut down on its planned steel investments.
All this is happening at a time when the company is yet to make any significant investments in India even after signing MoUs with state governments as early as 2005. Mr Mittal, last year, had said the company was looking to build smaller modules of steel plants in the emerging markets.
(source Business-standard)
BS reported that ArcelorMittal said the company still has a long way to go in India before it takes a final view on the construction of the proposed steel plants.
Mr LN Mittal president & CEO of ArcelorMittal while declaring Q3 results did not sound very enthusiastic about the progress of the company in India.
In a select media call, he said “We have got mining leases & licenses, which are in different stages of progress. Some are prospecting licenses, some are exploration, but we haven't got mining operation approvals yet.”
He said the mining allocations to ArcelorMittal were done long before so there was some progress.
He told “But it's still a long way to go before we take a final view on construction.”
The company has been eyeing countries like Brazil and India for expansions and its growth drivers in newer markets. However, the market uncertainties have forced it to cut down on its planned steel investments.
All this is happening at a time when the company is yet to make any significant investments in India even after signing MoUs with state governments as early as 2005. Mr Mittal, last year, had said the company was looking to build smaller modules of steel plants in the emerging markets.
(source Business-standard)
Thursday, October 13, 2011
Steel consolidation now focused on China - Mr LN Mittal
Thursday, 13 Oct 2011
Dow Jones reported that as per the world's largest steel maker’s CEO Mr LN Mittal, China holds the greatest potential for further consolidation within the steel industry following the conclusion of a consolidation spree in developed world such as the US and Europe.
Mr Mittal on the sidelines of the annual World Steel Association said “The potential is only in China. If you go around the geographies there is limited potential" for consolidating assets elsewhere.”
He noted that consolidation has already occurred in regions such as Europe and in the US, the world's second largest steel consuming country after China.
Mr Mittal said Chinese steel consolidation would be led by China's top 10 producers rather than foreign companies.
But Mr Mittal doesn't expect ArcelorMittal will play a role in the consolidation. He said “China is not in a mood to allow foreign companies to increase their presence in the country.”
He expects China's top 10 Chinese steel producers will account for 60% of China's steel output in five years' time and 75% in 10 years, up from 40% to 45% at the moment.
He noted that within five years, Chinese steelmakers may also start to look internationally to expand their operations, which would be positive for globalization.
(Sourced from Dow Jones Newswires)
Dow Jones reported that as per the world's largest steel maker’s CEO Mr LN Mittal, China holds the greatest potential for further consolidation within the steel industry following the conclusion of a consolidation spree in developed world such as the US and Europe.
Mr Mittal on the sidelines of the annual World Steel Association said “The potential is only in China. If you go around the geographies there is limited potential" for consolidating assets elsewhere.”
He noted that consolidation has already occurred in regions such as Europe and in the US, the world's second largest steel consuming country after China.
Mr Mittal said Chinese steel consolidation would be led by China's top 10 producers rather than foreign companies.
But Mr Mittal doesn't expect ArcelorMittal will play a role in the consolidation. He said “China is not in a mood to allow foreign companies to increase their presence in the country.”
He expects China's top 10 Chinese steel producers will account for 60% of China's steel output in five years' time and 75% in 10 years, up from 40% to 45% at the moment.
He noted that within five years, Chinese steelmakers may also start to look internationally to expand their operations, which would be positive for globalization.
(Sourced from Dow Jones Newswires)
Wednesday, April 27, 2011
Big proposals, but Arcelor & Posco spends in Orissa negligible
Wed, 27 Apr, 2011, 03.14PM IST,PTI
BHUBANESWAR: Two of the world's leading steel-makers, ArcelorMittal and Posco, had proposed to invest Rs 91,000 crore for setting up mega steel units in Orissa , but their actual investment was negligible even about half a decade after signing MoUs with the state government.
While ArcelorMittal had proposed to invest Rs 40,000 crore on its proposed 12-mtpa greenfield steel mill in Keonjhar district, Posco planned to invest Rs 51,000 crore for an equal capacity steel plant near Paradip.
While Rs 56,090.34 crore was invested in the steel sector of the state by March, 2011, ArcelorMittal invested nothing, said Orissa Steel and Mines Minister Raghunath Mohanty, adding that Posco claimed to have spent Rs 329.15 crore.
Of the total investment proposal of Rs 2,13,969.40 crore in the steel sector, the share of the two companies was around 42 per cent (Rs 91,000 crore).
Meanwhile, Posco's MoU tenure of five years ended on June 21, 2010, while ArcelorMittal's term would expire on December 20, 2011, he said.
While Posco made some progress, ArcelorMittal was yet to submit a detailed project report (DPR) to the state government, an official in the steel department said, adding that Bhusan Steels Limited had invested the highest amount of Rs 12,000 crore in the state, followed by JSPL's Rs 11,283.24 crore investment.
Bhusan Steels Limited achieved steel production of three mtpa by the end of March, 2011, the minister said.
Besides ArcelorMittal, the companies yet to make investment so far are: SSL Energy Limited (proposed investment of Rs 8,609 crore), Amtek Metal & Mining Limited (proposed investment of Rs 15,820 crore) and Deo Mines & Minerals (P) Ltd (proposed investment of Rs 316 crore).
While ArcelorMittal had proposed to invest Rs 40,000 crore on its proposed 12-mtpa greenfield steel mill in Keonjhar district, Posco planned to invest Rs 51,000 crore for an equal capacity steel plant near Paradip.
While Rs 56,090.34 crore was invested in the steel sector of the state by March, 2011, ArcelorMittal invested nothing, said Orissa Steel and Mines Minister Raghunath Mohanty, adding that Posco claimed to have spent Rs 329.15 crore.
Of the total investment proposal of Rs 2,13,969.40 crore in the steel sector, the share of the two companies was around 42 per cent (Rs 91,000 crore).
Meanwhile, Posco's MoU tenure of five years ended on June 21, 2010, while ArcelorMittal's term would expire on December 20, 2011, he said.
While Posco made some progress, ArcelorMittal was yet to submit a detailed project report (DPR) to the state government, an official in the steel department said, adding that Bhusan Steels Limited had invested the highest amount of Rs 12,000 crore in the state, followed by JSPL's Rs 11,283.24 crore investment.
Bhusan Steels Limited achieved steel production of three mtpa by the end of March, 2011, the minister said.
Besides ArcelorMittal, the companies yet to make investment so far are: SSL Energy Limited (proposed investment of Rs 8,609 crore), Amtek Metal & Mining Limited (proposed investment of Rs 15,820 crore) and Deo Mines & Minerals (P) Ltd (proposed investment of Rs 316 crore).
Saturday, January 15, 2011
ArcelorMittal mulls USD 200 million investment in new line
January 13, 2011
ArcelorMittal, Brazil, investment, steel ArcelorMittal may invest USD 200 million in a new Brazilian line with capacity to produce 500,000 tonnes of galvanized steel a year
Bloomberg reported that ArcelorMittal may invest USD 200 million to produce steel for Brazil's auto industry.
Mr Benjamin Baptista Filho, CEO of South American flat carbon steels unit, said that the new line would have the capacity to produce 500,000 tonnes of galvanized steel a year at ArcelorMittal's plant in the Brazilian state of Santa Catarina.
ArcelorMittal will likely make a decision by the end of March 2011 and the line would start operating in the first half of 2014.
Source: Bloomberg
ArcelorMittal, Brazil, investment, steel ArcelorMittal may invest USD 200 million in a new Brazilian line with capacity to produce 500,000 tonnes of galvanized steel a year
Bloomberg reported that ArcelorMittal may invest USD 200 million to produce steel for Brazil's auto industry.
Mr Benjamin Baptista Filho, CEO of South American flat carbon steels unit, said that the new line would have the capacity to produce 500,000 tonnes of galvanized steel a year at ArcelorMittal's plant in the Brazilian state of Santa Catarina.
ArcelorMittal will likely make a decision by the end of March 2011 and the line would start operating in the first half of 2014.
Source: Bloomberg
Friday, January 14, 2011
Arcelormittal, Nunavut Join Forces to Offer $1.51 a Share for Baffinland
Source: Bloomberg, by Thomas Biesheuvel and Natalie Doss - Jan 14, 2011
ArcelorMittal, the largest producer of steel, joined with Nunavut Iron Ore Acquisition Inc. in a bid for Baffinland Iron Mines Corp. valued at about C$519 million ($522 million) that seeks to end a three-month takeover battle.
The two companies offered C$1.50 ($1.51) a share for 100 percent of Baffinland, Luxembourg-based ArcelorMittal said in a statement today. Nunavut previously bid C$1.45 a share for 60 percent and ArcelorMittal C$1.40 apiece for the entire company.
ArcelorMittal and Nunavut, backed by Houston-based private equity-firm Energy & Minerals Group, were vying for Baffinland’s Mary River project in the Canadian Arctic. ArcelorMittal, based in Luxembourg, is seeking greater access to iron ore as prices for the steelmaking material rise. ArcelorMittal would hold 70 percent of Baffinland and Nunavut the rest under the new offer.
The Mary River project contains an estimated 365 million metric tons of reserves and 500 million tons of resources in three deposits that have been partially explored.
“Together with Nunavut Iron, we are providing a more attractive offer to Baffinland shareholders than either of us were prepared to provide on our own,” Peter Kukielski, head of mining at ArcelorMittal, said in the statement.
Daniella Dimitrov, vice chairwoman of Baffinland, Richard McCloskey, chief executive officer, and Michael Zurowski, executive vice president, didn’t immediately return telephone calls seeking comment.
Baffinland rose 3 cents, or 1.9 percent, to C$1.54 as of 9:47 a.m. in Toronto Stock Exchange trading. ArcelorMittal slid 0.3 percent to 27.195 euros by 4.11 p.m. in Amsterdam.
The new bid’s value was calculated using the 345.86 million of outstanding Baffinland shares, according to Bloomberg data.
Monday, January 3, 2011
ArcelorMittal raises Baffinland offer to $551 Million amid takover battle
ArcelorMittal, the world’s largest steelmaker, increased its offer for Canada’s Baffinland Iron Mines Corp. as it seeks to win over shareholders amid a three- month takeover battle.
ArcelorMittal bid C$1.40 ($1.40) a share in cash for all Baffinland shares, the Luxembourg-based company said today in a statement. That’s 27 percent more than its original offer and compares with a C$1.40 hostile bid for 60 percent of Baffinland’s stock from Nunavut Iron Ore Acquisition Inc. this week.
“This is the knockout punch,” Peter Campbell, an analyst at Jennings Capital Inc. in Toronto, said today in a telephone interview. “I suppose Nunavut could secure additional funds, but this is getting expensive for them.” He valued the bid at C$550.7 million, not including outstanding warrants.
Nunavut, a venture formed in August to buy Baffinland, and ArcelorMittal are vying to gain control of the Mary River iron- ore project in the Arctic. ArcelorMittal, which on Dec. 18 raised its offer to C$1.25 a share, is seeking greater access to the steelmaking ingredient as prices climb. Baffinland’s board today recommended that holders tender their shares to the ArcelorMittal offer.
Baffinland advanced 5 cents, or 3.6 percent, to C$1.43 at 3:59 p.m. in Toronto Stock Exchange trading. The shares have more than doubled this year.
‘Tremendous Upside’
“We will be considering our options in light of Arcelor’s new offer,” Nunavut’s Chairman Bruce Walter said today in an e- mail. “Given the tremendous upside of the Mary River project if it is developed under strong ownership, there are many shareholders who understand that our current bid still provides better economic value to them than the Arcelor offer.”
“We’re fully supportive” of the ArcelorMittal offer, Daniella Dimitrov, vice chairwoman of Toronto-based Baffinland, said in a telephone interview.
ArcelorMittal’s increased offer provides “demonstrably superior value and certainty for Baffinland shareholders, compared to Nunavut Iron Ore Acquisition Inc.’s revised coercive partial offer,” Peter Kukielski, ArcelorMittal’s head of mining, said in the statement.
Bidding War
The increased bid is 150 percent more than Baffinland’s price prior to Nunavut’s original 80-cent offer in September. ArcelorMittal entered the bidding when it agreed to pay C$1.10 in November, an approach that was countered by Nunavut with a C$1.35-a-share bid for 50.1 percent of the company on Dec. 15. Nunavut is backed by U.S. private equity firm Energy & Minerals Group.
ArcelorMittal’s bid is open for acceptance until 11:59 p.m. Toronto time on Jan. 10, the company said in the statement. Tom Johnson, a spokesman for ArcelorMittal in New York, had no comment beyond the press release.
Prices for iron ore and coking coal have surged this year because of demand from China, the largest steel producer. The cost of iron ore almost doubled in the April quarter and gained more than 20 percent in the June-to-September period.
ArcelorMittal said in September it planned to spend $4 billion to increase iron-ore production to 100 million metric tons a year by 2015.
The Mary River deposit, which holds reserves of 365 million metric tons of iron ore, is located about 620 miles (1,000 kilometers) northwest of Iqaluit, the capital of Nunavut, the largest of Canada’s three northern territories.
Gordon McCreary, the former Baffinland chairman who is seeking an outside bid from a Chinese company, said last week that discussions with a state-owned company are in an “advanced state.” He resigned from Baffinland’s board in November over its acceptance of ArcelorMittal’s first offer, which he considered too low.
Courtsey news via Bloomerg by the reporter Natalie Doss in New York at ndoss@bloomberg.net.
ArcelorMittal bid C$1.40 ($1.40) a share in cash for all Baffinland shares, the Luxembourg-based company said today in a statement. That’s 27 percent more than its original offer and compares with a C$1.40 hostile bid for 60 percent of Baffinland’s stock from Nunavut Iron Ore Acquisition Inc. this week.
“This is the knockout punch,” Peter Campbell, an analyst at Jennings Capital Inc. in Toronto, said today in a telephone interview. “I suppose Nunavut could secure additional funds, but this is getting expensive for them.” He valued the bid at C$550.7 million, not including outstanding warrants.
Nunavut, a venture formed in August to buy Baffinland, and ArcelorMittal are vying to gain control of the Mary River iron- ore project in the Arctic. ArcelorMittal, which on Dec. 18 raised its offer to C$1.25 a share, is seeking greater access to the steelmaking ingredient as prices climb. Baffinland’s board today recommended that holders tender their shares to the ArcelorMittal offer.
Baffinland advanced 5 cents, or 3.6 percent, to C$1.43 at 3:59 p.m. in Toronto Stock Exchange trading. The shares have more than doubled this year.
‘Tremendous Upside’
“We will be considering our options in light of Arcelor’s new offer,” Nunavut’s Chairman Bruce Walter said today in an e- mail. “Given the tremendous upside of the Mary River project if it is developed under strong ownership, there are many shareholders who understand that our current bid still provides better economic value to them than the Arcelor offer.”
“We’re fully supportive” of the ArcelorMittal offer, Daniella Dimitrov, vice chairwoman of Toronto-based Baffinland, said in a telephone interview.
ArcelorMittal’s increased offer provides “demonstrably superior value and certainty for Baffinland shareholders, compared to Nunavut Iron Ore Acquisition Inc.’s revised coercive partial offer,” Peter Kukielski, ArcelorMittal’s head of mining, said in the statement.
Bidding War
The increased bid is 150 percent more than Baffinland’s price prior to Nunavut’s original 80-cent offer in September. ArcelorMittal entered the bidding when it agreed to pay C$1.10 in November, an approach that was countered by Nunavut with a C$1.35-a-share bid for 50.1 percent of the company on Dec. 15. Nunavut is backed by U.S. private equity firm Energy & Minerals Group.
ArcelorMittal’s bid is open for acceptance until 11:59 p.m. Toronto time on Jan. 10, the company said in the statement. Tom Johnson, a spokesman for ArcelorMittal in New York, had no comment beyond the press release.
Prices for iron ore and coking coal have surged this year because of demand from China, the largest steel producer. The cost of iron ore almost doubled in the April quarter and gained more than 20 percent in the June-to-September period.
ArcelorMittal said in September it planned to spend $4 billion to increase iron-ore production to 100 million metric tons a year by 2015.
The Mary River deposit, which holds reserves of 365 million metric tons of iron ore, is located about 620 miles (1,000 kilometers) northwest of Iqaluit, the capital of Nunavut, the largest of Canada’s three northern territories.
Gordon McCreary, the former Baffinland chairman who is seeking an outside bid from a Chinese company, said last week that discussions with a state-owned company are in an “advanced state.” He resigned from Baffinland’s board in November over its acceptance of ArcelorMittal’s first offer, which he considered too low.
Courtsey news via Bloomerg by the reporter Natalie Doss in New York at ndoss@bloomberg.net.
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