BHP flags sale of its Nickel West business

BHP Billiton has today announced a review of its West Australian Nickel West business which could see the sale of the Mt Keith, Cliffs and Leinster mines and associated infrastructure.

The company said it is considering all options for the long-term future of Nickel West, including the potential sale of all or parts of the Nickel West business.

Also up for grabs as is the Kalgoorlie smelter, Kambalda concentrator, and the Kwinana refinery.

BHP has previously said that a portfolio focused on major iron ore, copper, coal and petroleum assets would be part of its four pillar company, with everything else subject to structural changes.

This leaves aluminium, nickel and bauxite exposed to the what BHP calls the next “phase of simplification”.

The company said the review of its Nickel West business is consistent with a “long held practice of continually reviewing its operations”.

At a mining conference in Miami last night, BHP boss Andrew Mackenzie said portfolio simplification is a compelling option for the company.

Speculation is mounting that the company will seek a demerger to its shareholders, that includes its aluminium, nickel and manganese assets, and create a new company worth $20 billion; but this afternoon’s announcement suggests it will seek to offload underperforming assets first.

It is understood Goldman Sachs has been appointed to facilitate the sale, but any deal would need to be signed off by WA Premier Colin Barnett if before a transfer of business can occur.

The announcement coincides with reports BHP has created a new company for its aluminium division.

SMH reports BHP Billiton Aluminium (Holdings) Pty Ltd was created May 6 and registered to BHP's Perth office, Brookfield Place.

The company has two directors, John Slaven and Stefano Giorgini, and its secretary is Robin Lees.

BHP Coal Holdings is listed as its sole shareholder.

Image: leighton.com.au