1st Oct 2014 11:24
LONDON (Alliance News) - International Ferro Ltd Wednesday said it has made an offer to acquire the coking assets of both Pacific Carbon Pty Ltd and Modderriver Minerals Pty Ltd, and will work with Portnex International to create a newly incorporated company.
It said the offer is made in conjunction with Portnex International, a private South African mining and commodities trading company which specialises in metallurgical coke products.
The ferrochrome producer said both it and Portnex International intend to acquire the assets through a newly incorporated company, of which International Ferro will hold two thirds, with Portnex holding one third.
"This potential acquisition is an important step in executing our strategy of diversifying our product and customer base...We have a long relationship with Portnex, working with them on our alternative reductant initiative, and together we have confidence we can return the Pacific Carbon assets to profit," said Chief Executive Chris Jordan in a statement.
Pacific Carbon and Modderriver Minerals together have six retorts located on Kooragang Island in Newcastle, Australia, used to produce intermediate or retort coke, which is used in ferroalloy and steel production. Those retorts have a capacity of 100,000 tonnes of retort coke per year, serving an existing customer base in Australia, New Zealand and Asia, International Ferro said.
The company said that the receivers and managers of both Pacific Carbon and Modderriver Minerals have accepted the offer, which is subject to a number of conditions including due diligence and gaining Australian foreign investment approval.
International Ferro and Portnex have been granted exclusivity for 30 days in order to finalise its due diligence and negotiate agreed transaction documents. It said the transaction would be funded using internally generated cash resources.
The company's stock was trading 3.7% lower Wednesday afternoon at 7.12 pence.
By Rowena Harris-Doughty; [email protected]; @rharrisdoughty
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