The Hindu Business Line : Hindalco's Australian subsidiary to go for public issue

Hindalco Industries Ltd today informed the BSE that it's wholly owned Australian subsidiary, Aditya Birla Minerals Ltd (Birla Minerals), intends to raise approximately A$299 million through an initial public offering in that country.

The funds raised would go towards repaying the subsidiary company's debt. The IPO prospectus has been filed with the Australian Securities & Investments Commission (ASIC). The shares would be listed on the Australian Stock Exchange.

The IPO would be an offer of fresh equity shares. Following the issue, Hindalco's equity stake in the subsidiary would fall to 51 per cent. The offer is at A$1.95 and the number of shares is 154 million.

Birla Minerals has under it Hindalco's Australian mining assets - the Birla Nifty Mines and the Birla Mt Gordon Mines. The debt burden of the subsidiary and how much it would be reduced post-IPO could not be ascertained.

Hindalco had acquired Nifty in the first half of 2003 from Straits Resources for A$79.80 million (Rs 253.77 crore). As of end-March 2005, Nifty had a capacity for 24,000 tonnes of copper cathodes. It was developing an underground mine and a concentration plant of 70,000 tonnes capacity, to be completed in the second half of FY06.

Mt Gordon, acquired in September 2003 from Western Metals Ltd for A$21 million (Rs 65.1 crore) is a combination of underground and open cast mining, concentration plant and a ferric leach plant. Against 50,000 tonnes cathode production capacity, it had supplied 35,126 tonnes of copper in cathode and concentrate form in 2005.

"Strategically, we would like to have 25-40 per cent of concentrate requirement coming from our own mines," Mr Kumar Mangalam Birla, Chairman, A.V. Birla Group, had said at the time of acquiring Mt Gordon.

Hindalco's overall business straddles copper and aluminium. Its copper smelter is located at Dahej.

More Stories on : IPOs | Overseas Investments | Aluminium | Hindalco Industries Ltd

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