24th Sep 2014 15:29
LONDON (Alliance News) - BHP Billiton PLC Wednesday said it is assessing a potential listing on the London Stock Exchange for the new company that will be created through a demerger of a number of its assets, following "extensive" discussions with shareholders.
The mining giant confirmed in August that it will demerge its aluminium, coal, manganese, nickel and silver assets into a new company, following press speculation. At the time the FTSE 100-listed company pledged to cut costs and improve the productivity of its remaining businesses in an attempt to boost shareholder returns.
BHP Billiton's demerger - which is expected to be completed in the first-half of calendar year 2015 - will leave it focused on iron ore, copper, coal, petroleum and potash.
BHP Billiton said Wednesday that it is "now assessing a potential Standard listing in London for the new company," after it initially said that the new company would be listed in Australia and South Africa and would be wholly-owned by BHP Billiton's existing shareholders initially.
The company said that the London listing would be in addition to the new company?s previously announced proposed primary listing on the Australian Securities Exchange and secondary inward listing on the Johannesburg Stock Exchange. The listing assessment follows "extensive" engagement with the company's investors and stakeholders, said BHP. "We have been pleased by the support for the demerger and the level of interest investors have shown in the new company.
Following the demerger, BHP Billiton Chief Financial Officer Graham Kerr will become chief executive while Head of Investor Relations Brendan Harris will become chief financial officer. Both will be based in Perth, Australia. David Crawford will be its chairman, stepping down from the board of BHP Billiton.
The assets selected for the new company include BHP Billiton's aluminium and manganese businesses and the Cerro Matoso Nickel, Energy Coal South Africa, Illawarra Metallurgical Coal and Cannington Silver-Lead-Zinc mines.
The mining giant has been working to simplify its portfolio of assets for more than a decade. Before deciding that a demerger was the best fit for the business, the company assessed a number of options in a portfolio review including an asset sale. "Today, BHP Billiton owns 41 assets worldwide. The proposed demerger will be a significant step towards focusing the portfolio on the 19 assets which generated 96 per cent of the Group?s underlying EBIT in the 2014 financial year," said the company in a statement.
Once the necessary approvals are in place, shareholders will have the opportunity to vote on the proposed demerger. The vote is to be undertaken on a voluntary basis, said the company.
The FTSE 100-listed miner said it expects to provide an update in November 2014.
Shares in BHP Billiton were trading 0.9% higher at 62.01 pence per share Wednesday afternoon.
By Joshua Warner; [email protected]; @JoshAlliance
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