China stainless steel mogul fights to avoid a second collapse
A debt crisis is threatening the future of one of the world’s top stainless steel producers, Jiangsu Delong Nickel Industry.
Russian metals producer Nornickel said on Friday it would spin off its stake in the Bystrinsky copper and gold mine and distribute it among its own shareholders.
Nornickel owns a 50% stake in the mine, which is about 90 km (55 miles) from the Chinese border in the Siberian region of Chita. Another 36.7% of the mine belongs to Nornickel’s largest shareholder and chief executive Vladimir Potanin. Chinese Highland Fund owns the remaining 13.3% stake.
The spin-off is subject to regulatory and corporate approvals and is expected to take two years, Nornickel said in a statement.
The mine currently produces concentrates of copper, gold and iron ore. It fully ramped-up its production around a year ago and generated $717 million in core earnings, known as EBITDA, in 2020.
Nornickel, the world’s largest palladium producer and one of the leading nickel producers, has been considering a possible initial public offering (IPO) of a firm running the Bystrinsky mine for a couple of years.
Potanin and aluminium producer Rusal own 34.6% and 27.8% in Nornickel, respectively.
“We welcome the decision of our major shareholders to support the spin-off of the Bystrinsky project,” Potanin said in a statement.
“The possible Bystrinsky spin-off is a logical continuation of the development of this project, which has significant potential,” Rusal’s deputy chief executive, Maxim Poletaev, said in a separate statement.
(By Polina Devitt; Editing by Louise Heavens and Andrew Heavens)
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