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Western Metals' sells copper mine to India

PERTH - Western Metals Ltd's receivers sold the former lead, zinc and copper miner's copper operations in the state of Queensland to the Indian conglomerate, the Aditya Birla Group.

On Tuesday Aditya Birla agreed to buy the Mt Gordon copper mine located 125 kilometers north of Mt Isa, for an undisclosed amount two months after the appointment of PricewaterhouseCoopers receivers and managers David McEvoy and Stephen Longley.

The debt-plagued miner went into receivership in July, a victim of depressed base metal prices and a disastrous hedge book.

"The Mt Gordon sale is an important result for employees, suppliers and secured creditors," McEvoy said. "Whilst we expect that there will be some changes in the transition, the critical outcome is that the deal avoids a shut down...[and] it also preserves the bulk of the workforce and supplier arrangements."

The receivers expect to announce within three weeks the sale of another Western Metals asset - a zinc and lead mine at Lennard Shelf near Fitzroy Crossing in the Kimberley region of Western Australia.

"We set out to sell Mt Gordon quickly and with the positive teamwork and support of the employees we have achieved that ... but more importantly the transaction demonstrates we are here to achieve a result ... a sale result," McEvoy said.

Aditya Birla group subsidiary Birla Mt Gordon Pty Ltd will buy the Queensland Mt Gordon copper operations. Birla intends to convert these operations from production of cathode on site to the production of copper concentrate to feed its Dahej smelter in the state of Gujarat in India.

Birla will offer employment opportunities to current workers at the Mt Gordon mine but expects to reduce staff numbers when the operational restructuring occurs.

Aditya Birla, which intends to become a significant Australian mining house, recently began operations in Australia after buying the Nifty Copper project, where it is developing a large scale underground mine and concentrator.

The Aditya Birla Group has operated globally for nearly 30 years with operations in 18 countries.

(Asia Pulse)

Sep 25, 2003

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