PRESS DIGEST-Australian Business News - May 5
Compiled for Reuters by Media Monitors. Reuters has not verified these stories and does not vouch for their accuracy.
THE AUSTRALIAN FINANCIAL REVIEW (www.afr.com)
Mining services, consumer products and chemicals group Orica (ORI.AX) yesterday reported a net profit of A$220 million for the six months to the end of March, a 2 percent fall compared to the previous half year. However, the group's after tax profits were 15 percent higher once one-off items were excluded. Orica's revenue increased 32 percent, and the company has increased its dividend by A1 cent a share to A40 cents. Chief executive Graeme Libelt said the company expects to increase full-year profit beyond last year's A$572 million. Page 19.
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Sam Walsh, the chief executive of Rio Tinto's (RIO.AX) iron ore division, has warned that the company may walk away from negotiations with Chinese steelmakers over contract iron prices if an agreement cannot be reached by the end of June. Analysts say Rio may have a clause in their agreements with steelmakers allowing them to end contracts if a deal is not reached by the end of next month. However, Chinese sources have raised doubts about Rio's willingness to walk away from existing contracts, given the current difficulty in maintaining sales volumes. Page 20.
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Perth-based shipbuilding company Austal (ASB.AX) has won over A$500 million in contracts in the past four weeks, with managing director Bob Brown saying that he believes the market is starting to recover. Last month Austal secured two contracts with European ferry companies valued at around A$220 million, and has also secured a contract to construct a littoral combat ship for the United States Navy which analysts believe is worth around US$250 million. Page 20.
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Telecommunications company Optus has signed a five year deal worth A$500 million with Australia and New Zealand Banking Group (ANZ) to provide managed services. The agreement will see Optus provide services for the bank across 30 countries, with ANZ saying that the consolidation of the services 'will help support our growth strategy across the region.' Optus says its parent company Singapore Telecommunication's presence throughout the region 'is a key point of differentiation for us.' Page 45.
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THE AUSTRALIAN (www.theaustralian.news.com.au)
Mining company BHP Billiton (BHP.AX) (BLT.L) has indicated that it is not interested in purchasing rival OZ Minerals' Prominent Hill copper and gold mine as it is not considered a large enough asset. The head of BHP Billiton's Olympic Dam mine, Dean Dalla Valle, said yesterday that the estimated A$1.15 billion Prominent Hill mine was not considered a tier-one asset, which is a pre-requisite for any acquisitions by BHP. Prominent Hill is OZ Minerals' (OZL.AX) Wsole remaining asset once shareholders approve a A$1.6 billion sale of its other assets to China's Minmetals. Page 18.
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South Australian (SA) mineral resources company Western Plains Resources (WPG.AX) has sold a 50 percent stake in its Hawks Nest iron ore project to Chinese steel producer Wuhan Iron and Steel for an estimated A$3 million. Federal Treasurer Wayne Swan recently said that he would veto any deals that gave Chinese companies control of assets near SA's weapons testing-range at Woomera, which is close to the Hawks Nest mine. However, Western Plains executive chairman Bob Duffin said yesterday that the agreement had been negotiated to 'meet the hurdles imposed by Defence.' Page 18.
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Brewer Lion Nathan LNN.AX has told its shareholders that the A$3.5 billion takeover by Japanese brewer Kirin Holdings (2503.T) will take another week to finalise. The terms of last week's deal, which pays shareholders A$11.50 per share plus a A72 cents special dividend, were planned to be agreed on by May 4. However, Lion said yesterday that it may take at least another week to finish negotiations, which are believed to have stalled on 'terms around the merger process agreement,' according to Lion chairman Geoff Ricketts. Page 19. Continued...
