13 Aug South32 to sell stake in manganese alloy smelter to Gupta’s GFG Alliance
South32 has announced the sale of its entire stake in manganese alloy smelter Tasmanian Electro Metallurgical Company (TEMCO) to UK-based conglomerate GFG Alliance.
The Australian diversified miner said on Thursday that GFG, owned by British conglomerate Sanjeev Gupta, will acquire 100% of the shares in TEMCO for a nominal amount once approval is received from Australia’s foreign investment review board.
TEMCO, located in Northern Tasmania, is run by the Samancor Manganese Joint Venture (JV) – a 60:40 agreement between South32 and Anglo American respectively.
As a condition to the completion of the transaction, TEMCO and the Samancor Manganese JV entered into an agreement for the JV to supply ore to the smelter.
“Today’s agreement follows an extensive review of options regarding the future of our manganese alloy business,” said South32 CEO Graham Kerr.
“The transaction and our ongoing supply of ore to TEMCO will see the smelter, first established in 1962, continue to operate into the future.”
The smelter had been in some danger of permanent closure due to a weakened global manganese market, but is set to be saved by Gupta, along with its 250 employees.
Gupta said the facility would strengthen its steel-making capability in Australia and around the world. TEMCO will join part of the alliance’s Liberty Steel Group.