BHPB to buy WA contractors for US$735m
- Publishing Date
- 09 Aug 2011 11:14am GMT
- Author
- Mining Magazine
BHP Billiton has signed a heads of agreement with Leighton Holdings Ltd for the US$735 million purchase of its HWE Mining subsidiaries, which provide contracted mining for the Western Australia Iron Ore (WAIO) operations.
The heads of agreement covers equipment, 2,500 people and related services on the Area C, Yandi and Orebody 23/25 operations.
BHP Billiton's President Iron Ore, Ian Ashby said: “While this move to an owner-operator model will remove a layer of complexity and costs from our business, the real focus of this proposed transaction is the workforce.”
The three operations account for 70% of total material movement of the entire WAIO business. Leighton said the operations represent approximately A$1.1 billion (US$1.1 billion) of annual revenue for the company.
Leighton added: “The potential sale would recognise the creation of substantial value by Leighton since it purchased HWE Mining out of administration in 2006.”
The transaction was expected to close during the fourth quarter of calendar year 2011.
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