BHP creates new aluminium company
BHP Billiton has advanced the reorganisation of its internal corporate entities, creating a new company through the Australian securities regulator for its aluminium division.
The move comes as BHP's board and management consider spinning "non-core" assets into a new $20 billion division that would potentially be handed back to shareholders. All options are on the table as BHP evaluates strategies for assets that do not fit within chief executive Andrew Mackenzie's "four pillars" agenda. Goldman Sachs is advising the company on the transformative plan, code-named Project River.
BHP Billiton Aluminium (Holdings) Pty Ltd was created May 6 and registered to BHP's Perth office, Brookfield Place. It has two directors, John Slaven and Stefano Giorgini, and its secretary is Robin Lees. Brisbane-based BHP Coal Holdings is its sole shareholder however BHP is the ultimate holding company and it is unclear whether BHP Billiton Aluminium retains any physical assets.
The Australian Financial Review reported earlier this month that the company had secured exemptions from the Australian Tax Office as early as last year for capital gains, dividend and stamp duty issues as it navigates structures for what could eventually become a spun-off group. The company is also believed to be undergoing a thorough review of its web of corporate and legal sub-structures after years of acquisitions ahead of any strategic decision.
A BHP spokesperson said: "Like all companies, we frequently review our various corporate and legal structures."
Mr Mackenzie said on Tuesday in the United States that the case for further simplification of the business was "compelling", reigniting speculation that BHP will lean towards a spin-off.
No decisions had been yet, he told an investor conference, and the outcome may not be known until BHP's annual results due in August. "The case for the continued simplification of our portfolio is compelling and it remains our priority," he said. "Simplification will create a portfolio of unrivalled quality and be the catalyst for increased and accelerated productivity gains. Value is our priority, and we will get it right.''
Investors are broadly supportive of Mr Mackenzie's strategy to unlock value and drive efficiency gains.
Publish date : Friday 16 May 2014 14:25
Story Code: 8268