Birlas buy Australian mine for Rs 65 crore

Mt Gordon has been purchased from the ailing Australian firm Western Metals Ltd, for 21 million Australian dollars (around Rs 65 crore). The final payment will be made on October 31, subject to RBI approval. The acquisition will be funded through a debt-equity ratio of 60:40.

At present, only two mines in the Mt Gordon area are operating and their combined output is 50,000 tones of copper cathode per annum.

‘‘In the next six-eight months we will set up a concentrator at the cost of 10 million Australian dollars, to produce concentrate. Till then, we will continue with the production of cathode,’’ informed Debu Bhattacharya, managing director-designate of Hindalco.

An upside is the acquisition of two joint venture sites — Mount Oxide and Mount Osprey, in which the Birlas can acquire 62.5 per cent. The stake in each mine will cost Australian $1.5 million.

Bhattacharya said they preferred Australia also because of the short sailing time and lower freight cost as compared to sourcing copper concentrate from South America.

The reported resources of the mines are estimated at 20 million tonne of ore grading 3.6 per cent copper. Together, Mount Gordon and Nifty Copper mines will cater to more than one-third of Birla Copper’s concentrate requirement.