Shell set to auction off mine stake
Sunday 08 May 1994
The move is part of the group's planned dollars 1bn ( pounds 671m) disposal of Billiton, its metals and mining arm, which has been the subject of year-long disposal talks with Gencor, the South African group.
Billiton's prime assets include a one-third stake in the dollars 500m Collahausi copper mine in Chile. Although Gencor is keen to buy Shell's stake, it is being thwarted because of pre- emption rights of the mine's co- owner, Minorco, which is controlled by Gencor's South African rival, Anglo American, and Falconbridge, the cash- strapped Canadian group.
However, Shell is thought to be considering putting its stake on the open market to maximise proceeds and help break the stalemate between Gencor and the co-owners.
The expected auction will almost certainly spark huge interest from the world's mining giants, including Britain's RTZ Corporation, BHP of Australia and Kennecott of the US.
But with an estimated cash pile of dollars 800m, Minorco is thought to be determined to match any rival offers to clinch a majority stake in Collahausi, which contains ore reserves of about 1.6 billion tonnes.
Despite the hold-up, Shell and Gencor are understood to have made considerable progress over Billiton in the past few weeks.
After much delay, the South African group is thought to be close to securing long- term finance for the acquisition.
In addition, the talks have gained fresh impetus from the recent successful elections in South Africa. As a result there is growing confidence that the two could clinch an agreement before June.
Billiton incurred an almost doubled net loss of dollars 142m last year, stemming partly from heavy restructuring charges.
On Wednesday Shell is expected by some City analysts to report a dip in first-quarter profits due to the impact of weak oil prices. David Stedman of Daiwa Research is forecasting net income of pounds 900m for the period to 30 March against pounds 971m last year.
However, the recent rally in oil prices and a strong first- quarter result from British Petroleum pushed Shell's shares 10p higher to 732p last Friday.
John Jennings, chairman of Shell Transport and Trading, the UK co-owner of Royal Dutch/Shell, said world energy demand could grow by 70 per cent over the next 30 years.
- 1 A daily walk 'can add seven years to your life'
- 2 Rules on 5p plastic bags likely to lead to arguments at the check-out
- 3 Chrissie Hynde says women who 'wear high heels and dress provocatively entice rapists'
- 4 Blood Moon and Supermoon: September to bring brightest – and dimmest – full Moon of the year on same night
- 5 News agency criticised for describing Amal Clooney as 'actor's wife' in coverage of human rights trial
University to mark down students who say 'illegal immigrants' in class
Rules on 5p plastic bags likely to lead to arguments at the check-out
The nine most warmongering countries in the world revealed
Blood Moon and Supermoon: September to bring brightest – and dimmest – full Moon of the year on same night
VMAs 2015: Kanye West to run for US president, Nicki Minaj calls out Miley Cyrus and the rest of tonight's winners
Climate change: 2015 will be the hottest year on record 'by a mile', experts say
'Women only' train carriages: Jeremy Corbyn unveils radical move to tackle public harassment
Black holes are a passage to another universe, says Stephen Hawking
Tony Blair attacks Jeremy Corbyn's 'Alice In Wonderland' politics
Theresa May says migrants should be banned from entering the UK unless they have jobs lined up
Iain Duncan Smith 'should resign over disability benefit death figures', says Jeremy Corbyn
iJobs Money & Business
£25000 - £30000 per annum: Recruitment Genius: From modest beginnings the comp...
£35000 - £40000 per annum: Recruitment Genius: From modest beginnings the comp...
£15000 - £65000 per annum: Recruitment Genius: This is an exciting opportunity...
£18000 - £20000 per annum: Recruitment Genius: This is a fantastic opportunity...