Bloomberg News

Fortescue to Trim List of Buyers for Stake in Rail-Port Assets

January 24, 2013

Fortescue Metals Group Ltd. (FMG), Australia’s third-largest iron-ore producer, expects to narrow the list of potential buyers for a stake in its rail and port infrastructure assets within four or five weeks.

“We’ve had very, very strong interest and we’ve begun the process of engaging with the selected proponents to work through the details,” Neville Power, chief executive officer of the Perth-based company, told reporters today on a call after reporting a 32 percent rise in second-quarter shipments. “We would expect to have a shortlisting of that in the next four weeks or five weeks or so and then we’ll give an update.”

Fortescue started talks last month to sell a minority stake in the rail and port operations in Western Australia state and hired Lazard Ltd. (LAZ:US) and Macquarie Group Ltd. as financial advisers. The company may sell as much as 40 percent of the assets for as much as $4 billion, Michael Evans, a Sydney-based analyst at CIMB Securities (Australia) Ltd., said in a Jan. 4 report.

Atlas Iron Ltd., billionaire Gina Rinehart’s Hancock Prospecting Pty and offshore pension funds may be interested in buying a stake, Chris Drew, a Sydney-based analyst with RBC Capital Markets, said last month.

The company said in December it would restart an expansion to boost output to 155 million metric tons a year after prices rose, driven by demand from China. It cut spending, sold assets and cut jobs in September after prices fell to a three-year low.

To contact the reporter on this story: James Paton in Sydney at jpaton4@bloomberg.net

To contact the editor responsible for this story: Jason Rogers at jrogers73@bloomberg.net


Race, Class, and the Future of Ferguson
LIMITED-TIME OFFER SUBSCRIBE NOW

(enter your email)
(enter up to 5 email addresses, separated by commas)

Max 250 characters

Companies Mentioned

  • LAZ
    (Lazard Ltd)
    • $53.62 USD
    • -0.34
    • -0.63%
Market data is delayed at least 15 minutes.
 
blog comments powered by Disqus