(Minews) - BHP Billiton has put a $12.95 billion valuation on the assets it is set to spin off in June and loaded it with much less debt than analysts had forecast, positioning the new company, South32, to grow.
The world's biggest miner released documents on Tuesday detailing the performance of South32's aluminium, manganese, nickel, silver and coal assets, long overshadowed by BHP's iron ore, petroleum, copper and metallurgical coal businesses.
"The demerger will simplify BHP Billiton and has the potential to unlock shareholder value, while creating a new global diversified metals and mining company with a significant industry presence in each of its major commodities," BHP Chairman Jac Nasser said in a statement.
The hotly anticipated document showed the new mid-sized miner plans to pay out a minimum of 40 percent of its underlying earnings in dividends each half-year.
It does not intend to pay a dividend for the period ending June 30, 2015, which will conclude only one month after the implentation of the merger.
Named for the 32nd parallel south line of latitude linking its two main centres, Australia and South Africa, the company will emerge from the mothership with $674 million in net debt, which is less than half the level analysts had expected.
Shareholders are set to vote on the spin-off on May 6, with trading in South32 shares expected to begin on June 2.
BHP said the South32 assets contributed net profit after tax of $738 million for the 6 months ending 31 December 2014 and $217 million for the year to June 2014.
The total one-off costs of implementing the demerger are estimated to be around $738 million.
