China’s largest iron and steel trader, China Minmetals Corporation, which is also a major mining group, was last week reported by China Daily to be interested in buying the zinc assets of Anglo American plc.

Another journal, the Chinese-language 21st Century Business Herald, reported that Anglo American was also in talks with Chinalco, China’s largest diversified mining company, 
over the latter buying Anglo subsidiary Scaw Metals.

Last month, the dual London Stock Exchange- and JSE-listed global mining group announced that it was going to dispose of 
assets identified as noncore. These are its zinc assets (which currently fall under its Base Metals division, which is to be split into a Copper Business Unit, based in Chile, and a Nickel Business Unit, based in Brazil), Scaw Metals, Catalão (a ferroniobium-miner in Brazil) and Copebrás (a phosphate fertilisers and phosphoric acid producer, also in Brazil). The group had also previously (in August) identified its road building subsidiary, Tarmac, as noncore, and put it on the market.

Anglo’s zinc assets comprise the Skorpion mine, in Namibia, and the Lisheen mine, in Ireland, both wholly owned by Anglo, and the Black Mountain mine and Gamsberg project, both in South Africa and both 74%-owned by the mining group. Together, in 2008, these 
operations had an output of 340 500 t of zinc and earnings before interest, tax, depreciation and amortisation (Ebitda) of $209-million.

The China Daily quoted an unnamed China Minmetals source as saying that the group was eager to obtain these zinc assets, as the Chinese company’s “zinc business has started 
to grow”. 
“Seeking other zinc projects to meet its growing demand is in line with the company’s 
business strategy.” The source would give no other details, owing to confidentiality 
requirements.

The Scaw Metals group is an international 
steel products manufacturing group. It uses steel scrap and directly reduced iron to produce liquid steel which is then used to manufac-
ture value-added steel products. The group is 
divided into two companies, Scaw South Africa 
and Scaw International, and has its major oper-
ations in South Africa, Australia, Canada, 
South America as well as smaller operations in Namibia, Zambia and Zimbabwe. Last year, Scaw’s output was 771 000 t of steel products in South Africa and 879 000 t internationally, resulting in Ebidta of $309-million.

China Minmetals is that country’s largest supplier of raw materials to the metallurgical industry and has iron-ore reserves of 600-million tons and coking coal reserves of 250-million tons. It sells some 20-million tons of steel products annually, and manufactures equipment for the metallurgical industry, including blast furnaces. State-owned, it was founded in 1950 and in 1999 was identified as one of 44 “key enterprises” with regard to national and economic security that were under the direct control of the national (as distinct from provincial) government. In 2008, China Minmetals achieved total revenues of $27,7-billion and was ranked 331st in the Fortune magazine Global 500 list.

Chinalco – the Aluminium Corporation of China, to give its full name – was created 
in 2001 by the merger of 12 Chinese aluminium companies. It is also owned by the Chinese State.

Currently, it mines bauxite, copper and 
titanium, producing alumina, aluminium, copper concentrate, copper cathodes, fabricated copper products, sponge titanium and titanium alloys.