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« on: April 02, 2014, 09:53:33 am »
Global mining giant BHP Billiton is considering spinning-off its aluminium, bauxite and nickel assets into a single entity that would be worth about Aus$20-billion ($18.5-billion), reports said Wednesday.
The Anglo-Australian resources company wants to demerge "non-core" assets that are not providing adequate returns, as part of a streamlining process that will focus its portfolio on top-tier assets, the Australian Financial Review said.
It said BHP, which this year announced an 83 percent rise in interim net profit to US$8.1-billion, would keep the lucrative operations that are central to its "four pillars" strategy - iron ore, coal, petroleum and copper.
The Australian newspaper said the resources giant was considering demerging all its non-core assets, rather than selling them off individually.
It said the strategy had worked for BHP in the past, when it spun off its steel assets into OneSteel and BlueScope in 2000-01.
BHP responded to the speculation by saying it was actively studying the next phase of simplifying its portfolio "but will only pursue options that maximise value for BHP Billiton shareholders".
"We believe that a portfolio focused on our major iron ore, copper, coal and petroleum assets would retain the benefits of diversification, generate stronger growth in free cash flow and a superior return on investment," it said.
"By increasing our focus on these four pillars, with potash as a potential fifth, we will be able to more quickly improve the productivity and performance of our largest businesses."
BHP shares were up 0.93 percent at Aus$37.39 in late afternoon trading on the Australian Stock Exchange.