Kate Haycock -- MINING NEWS -- Monday, 30 March 2009
OZ MINERALS is keeping mum over rumours of a new deal with China’s Minmetals in the wake of the federal treasurer’s decision to block the sale of Prominent Hill.
The new deal, as reported by several media outlets, would see Minmetals buying OZ without Prominent Hill.
On Friday, Treasurer Wayne Swan blocked the $A2.6 billion Minmetals takeover for OZ, saying it could not go ahead if Prominent Hill was included in the deal because the mine was close to the Woomera Prohibited Area weapons testing range.
This morning, a spokesperson for OZ said the company was not commenting on the rumours, and media reports so far have not detailed any revised terms for the rumoured new Minmetals deal.
However, one broker this morning said if Minmetals was “still inclined to purchase the balance of the OZ’s assets” without Prominent Hill, a new deal could still be worth around $1.8 billion, given a Prominent Hill valuation of around $825 million.
“It is entirely conceivable, if not likely, that OZ [will] not emerge from this latest setback,” the analyst also warned.
On Friday, OZ managing director and chief executive officer Andrew Michelmore said the company was in talks with Minmetals over possible changes to the structure of the deal.
OZ is in a trading halt and faces another hurdle tomorrow with $A1.3 billion in debt due to be repaid or refinanced.
Late last week the company said it hoped to extend the refinancing date until September 15, which was to have been two weeks after the deadline for the finalisation of the Minmetals deal.
Shares in OZ were at 55.5c before trading was halted on Friday.
OZL Price at posting:
55.5¢ Sentiment: None Disclosure: Not Held
