| The TEX Report Topics < Ferro Alloys > | |
| HOME >> Topics List >> January, 2006 >> 30 (Mon) |
| Kazakhstan Launches Into South Africa With Acquisition of 32.5% Shares |
| = IMR Has Participated In Capital Of Kermas, To Usher New Phase In Chrome Industry |
|
It was known that IMR ( International Mineral Resources ), which has secured a substantial foothold on businesses of natural resources and metals in Zambia, Makedonia and so on, has acquired 32.5% of the shares of Kermas. Kermas has taken over in June of 2005 Samancor Chrome of South Africa from BHP Billiton for US$600 million and held the capacity to produce 1.10 million tons per annum of ferro-chrome . On the other hand, IMR has placed KazChrome of Kazakhstan under their control and KazChrome has held the capacity to produce approximately one million tons per annum of ferro-chrome. The chrome reserves in South Africa and Kazakhstan are distinguished in the world and, accordingly, IMR has possessed the bases to produce ferro-chrome in these two countries. However, Kazakhstan produces high carbon ferro-chrome with a higher content of chrome and South Africa produces charge chrome with a lower content of chrome. Consequently, the parties concerned said that these two countries have separated each other the market for respective demand. Also, even though Kazakhstan ( IMR ) has acquired 32.5% of the shares of South Africa ( Kermas ), these two enterprises said that they will proceed the marking for ferro-chrome in parallel and do not form a joint structure for sales. The mostly interested matter is related with the Antimonopoly Act to be judged by the judicial authorities concerned in Europe and South Africa on the cooperation between these two enterprises but they have already obtained a response, which Germany, as understood to be a most severe country in Europe for this Act, will grant an approval of this cooperation. An application for this cooperation to the Government of South Africa will be submitted soon. In view of the fact that BHP Billiton and AAC ( Anglo American Corp.), which are two major shareholders of Samancor in South Africa, did not take up the countermeasures for rationalization of ferro-chrome plants in the last several years, the measures to strengthen a power for competition seem to be necessary to materialize. Also, in order to cope with a fluctuation of the exchange rate, this cooperation will have a merit to be able to hedge each other a risk of the exchange rate. At present, South African enterprises have suffered from the extremely strengthened exchange rate of South African Rand against US-Dollar and the current rate has exceeded R.6 against US$1.00 but the exchange rate in 2003 or before had weakened to an extreme extent ( US$1.00 : R.13 ). When the exchange rate of Rand currency had weakened, Kazakhstan had faced an unfavorable situation against South Africa on its exchange rate. For a reference, a reaction to the deal as mentioned above shown by such chrome consumers as stainless steel mills is comparatively favorable with an understanding that a stabilization of the operational composition in South Africa, as a major source to supply raw material for production of stainless steel, will be materialized. |
| last modified : Thu 02 Feb, 2006 [10:41] |
