Any idea who this could be? They mention distressed companies...

Any idea who this could be? They mention distressed companies that are unable to raise funds I assume not the likes of WSA, MCR etc?


Xstrata May Buy Australian Nickel Mines as Metal's Price Falls

By Rebecca Keenan

Aug. 6 (Bloomberg) -- Xstrata Plc, the world's fourth- largest nickel producer, is considering buying assets in Australia as the price of the metal declines.

``We have looked at some opportunities, given the price is coming off,'' Xstrata Nickel Chief Financial Officer Shaun Usmar said today at a media conference in Kalgoorlie, Western Australia. Due to some companies' inability to raise funds ``we have seen some distressed situations that represent value,'' he said, without naming any potential targets.

Xstrata, the owner of mines on four continents, this year bought Australian nickel company Jubilee Mines NL for A$3.1 billion ($2.9 billion), and today made a hostile 5 billion-pound ($9.8 billion) bid for Lonmin Plc to double revenue from Africa and become the world's third-largest platinum producer.

Rising supplies of nickel and reduced demand from steelmakers have led to a 34 percent decline in nickel to $17,400 a ton ($7.90 a pound) this year. The drop in the price, combined a slide in global markets, has generated opportunities to buy assets at a cheaper price, Usmar said.

Nickel prices may begin to improve by the fourth quarter of this year, he said. At the current nickel price, the industry is either at or below the marginal cost of production, he said.

``Our estimates are that there is at least 20,000 tons of nickel and pig iron that is not viable,'' he said.

To contact the reporter on this story: Rebecca Keenan in Melbourne at [email protected]
Last Updated: August 6, 2008 07:03 EDT