North Bh Remains A Seller Of Pasminco
Sydney Morning Herald
Tuesday June 16, 1992
North Broken Hill Peko Ltd is still keen to sell down its holding in Pasminco Ltd as soon as possible despite the deferral of the sale in April, according to NBH managing director Mr Peter Wade.
He said yesterday that NBH's advisers, Ord Minnett Securities Ltd in Australia and Credit Suisse First Boston Ltd in London, were continuing to canvass potential buyers for the 40 per cent stake worth about $400 million.
However, he said he would be surprised if the stake was sold before the end of the financial year despite renewed market speculation a sale was imminent.
NBH and CRA Ltd announced on February 27 that the two companies had decided to reduce their combined holding in Pasminco to just under 40 per cent from 80.6 per cent after NBH gave notice that it wanted to halve its holding.
The companies have each held 40.3 per cent of Pasminco since it was formed in 1988 to absorb most of their base metals assets.
NBH wants to reduce its holding so it can redeploy the funds locked up in Pasminco in new projects, most notably its 50 per cent Kanowna Belle gold joint venture with Delta Gold NL which is about to be developed near Kalgoorlie.
CRA decided that it would reduce its stake by an equal amount as it had no wish to become the major shareholder in Pasminco and be forced to consolidate the base metals group's debt in its own accounts as would be required under new accountancy standards.
Mr Wade said that following the February announcement it became obvious that there were two markets for the stock - institutions and corporate buyers
The institutions had neither the capacity nor the desire to absorb 40 per cent of Pasminco, leaving corporates as the only potential buyers. These are almost certainly all international companies. Japanese industrial conglomerates are understood to be at the top of the list of potential buyers although some European metal groups have also expressed interest.
Mr Wade said one Japanese company had been in almost daily contact with his company's advisers over the proposed sale but he declined to name names.
Analysts suggest Japan's Mitsui Mining and Smelting Company is the hot favourite.
© 1992 Sydney Morning Herald
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