See More

Arcelor misses iron ore stake in Guinea

Dec 19 2012 19:40 Reuters

Oil rig (US Coast Guard, AP)

Related Articles

'Oil shields Africans from criticism'

50% pay hike for Guinea state employees

BHP Billiton to sell stake in gas JV

BHP may curtail iron ore expansion

Iron ore prices propped up by output drop

BHP boss tops Australian CEO pay list

London - BHP Billiton [JSE:BIL] has selected mining venture B&A Mineração as the preferred bidder for its stake in Mount Nimba, one of the largest iron ore deposits in Guinea, a source familiar with the situation said.

B&A Mineração was founded by Roger Agnelli, the former chief executive of Brazil's Vale, together with investment bank BTG Pactual BTG.UL, which is controlled by billionaire financier André Esteves.

The venture is hammering out conditions for exclusive talks, the source said.

"BHP will enter exclusive negotiations with B&A to sell its slice in Mount Nimba and its smaller iron ore assets in Liberia," the source said.

BHP and B&A Mineração declined to comment.

B&A, a relative newcomer with bold ambitions in the sector, beat rivals including ArcelorMittal [JSE:ACL], the world's largest steelmaker, which is strapped for cash but owns a large project of its own just over the border.

Market sources valued the potential deal at around $500m to $600m.

BHP, the world's largest miner, currently owns a stake of just over 40% in the venture behind the Mount Nimba deposit. Gold miner Newmont owns another 40%.

A third party, French power plant builder Areva, is currently being bought out of the venture by BHP and Newmont, leaving both with a 50% slice, a source familiar with the matter said last month.

BHP decided earlier this year to pull out of its Mount Nimba iron ore project and also cast doubt on the prospects of dozens of West African iron ore projects.

Mount Nimba is not the first time Agnelli has targeted Guinea.

Two years ago, when Agnelli was at the helm of Vale, the world's largest iron ore miner pushed into the West African country, taking a stake in assets including blocks of the giant Simandou deposit, which had been confiscated by the government from rival Rio Tinto.

The decision of the world's top miners to invest in resource-rich Guinea and West Africa in recent years fuelled local governments' hopes that a mining boom would benefit the region.

Development has often been slow, however, Agnelli was ousted from Vale last year after a decade. Analysts said his plans for a multinational Vale, did not chime with the Brazilian government's own, more nationalistic view.

Follow Fin24 on Twitter, Facebook, Google+ and Pinterest.

arcelor mittal  |  bhp billiton  |  guinea  |  mining  |  iron ore



Read Fin24’s Comments Policy

24.com publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
Add your comment
Comment 0 characters remaining

Company Snapshot

We're talking about:


Johannesburg has been selected to host the Global Entrepreneurship Congress in 2017. "[The congress] will ensure that small business development remains firmly on the national agenda and the radar screen of all stakeholders, the Small Business Development minister said.

The Fast and Furious R40 million

With the Fast and the Furious 7 hitting South African cinema’s this April, all eyes are on the cars and we’re in for a treat!


Luxury living

This is the most expensive burger in the world!
Exclusive food items that WILL break the bank
Top 10 most expensive homes in the world
You can permanently live on a ship and sail the world!

Money Clinic

Money Clinic
Do you have a question about your finances? We'll get an expert opinion.
Click here...

Voting Booth

How will you manage Vodacom’s price hike for contracts?

Previous results · Suggest a vote