Chinese giant in the run for Skorpion

CHINA Metallurgical Group Corp, a leading Chinese conglomerate engaged in real estate and construction as well as metallurgy and other industries, is keen to buy the zinc assets of Anglo American Plc, including Skorpion Zinc, chinaknowledge.com reported yesterday.

The company has been looking for opportunities to acquire natural resources, the website said.’China Metallurgical is seen as the strongest bidder because of its strong financial position,’ chinaknowledge.com said.Last week, Reuters reported that a handful of rival miners were preparing to submit binding bids later this month.Anglo, under pressure from investors after an abortive merger approach from rival Xstrata last year, is selling the mines in Ireland, South Africa and Namibia as part of a multi-billion dollar disposal and restructuring programme.Several of the world’s biggest zinc miners, including Xstrata, its biggest shareholder Glencore, and Vedanta’s Hindustan Zinc Ltd unit are likely to bid, the news agency said. Anglo is seeking to sell the business as a whole, they added.Analysts at BMO Capital Markets estimate the assets could fetch US$1,1 billion. A more bullish Panmure Gordon says they could be worth US$1,5 billion – or about 6,4 times 2009 earnings before interest, tax, depreciation and amortisation (ebitda).Anglo spokesman James Wyatt-Tilby declined to comment in detail but said: ‘The process is advancing. There has been strong interest.’Anglo is selling the Skorpion mine, Ireland’s Lisheen and the Black Mountain mine and Gamsberg project in South Africa, in which Exxaro Resources Ltd owns a 26 per cent stake. – chinaknowledge.com and Nampa-Reuters

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