Asian Consortium Takes 15% Stake in ArcelorMittal Mines Canada

ArcelorMittal Mines Canada operates two iron ore mines in Quebec, Mont-Wright (shown here) and Fire Lake.
Following a recent agreement, a consortium led by POSCO and China Steel will take a 15% share in these assets.
(Photo courtesy ArcelorMittal)
ArcelorMittal announced on January 2, 2013, an agreement pursuant to which its wholly-owned subsidiary ArcelorMittal Mines Canada and a consortium led by Korean steelmaker POSCO and China Steel Corp. of Taiwan will enter into a joint venture partnership that will own ArcelorMittal’s Labrador Trough iron ore mining and infra-structure assets in Quebec. The consortium will acquire a 15% interest in the joint ven-ture for total consideration of $1.1 billion in cash, with ArcelorMittal Mines Canada and its affiliates retaining 85%.

As part of the transaction, POSCO and China Steel will enter into long-term iron ore off-take agreements proportionate to their joint venture interests.

The transaction is subject to various closing conditions, including regulatory clearance by the Taiwanese government, and is expected to close in two installments in the first and second quarters of 2013.

Peter Kukielski, chief executive-mining at ArcelorMittal and a member of the group management board, said, “We are commit-ted to growing ArcelorMittal’s mining busi-ness. This joint venture incorporating a long-term off-take agreement is consistent with our strategy to forge strategic relation-ships with key customers as we build our global mining business. The consortium will be an excellent partner as we pursue further expansion at ArcelorMittal Mines Canada.”

ArcelorMittal Mines Canada operates two large open-pit iron ore mines, Mont-Wright and Fire Lake. The Mont-Wright site is linked by company rail to its Port-Cartier industrial complex, which includes a pellet plant, storage areas, and port facilities for shipping. The company pro-duces about 15 million mt/y of iron ore concentrate and more than 9 million mt/y of iron oxide pellets.

As featured in Womp 2013 Vol 02 -