7 million tonnes according to GFMS experts

Zinc had been abandoned by the movement of the base metals industry consolidation. The Belgian Umicore and the Australian Zinifex come to repair this oversight by joining their forces in refining, and zinc alloy. The displayed objective is clear: become the number one global zinc metal, over a blow the current leader, Korean Korea Zinc Group, and the number two Xstrata, which recently climbed to position with the acquisition of the Canadian Falconbridge.

The new group is expected to produce about 1.2 million tonnes of metal refined for a global flow which should reach, in 2006, about 10.7 million tonnes, according to GFMS experts. The two allies will share their respective activities of fusion and alloys of zinc (and lead in the case of Zinifex). In contrast, Umicore will keep its materials technology division and the Australian mining operations. Zinifex is the third world producer of zinc with, in 2005 concentrate, 600,000 tonnes of ore, behind Xstrata (839.000 tonnes) (1) and the Canadian Teck Cominco (659.000 tonnes).

The joint venture between Zinifex and Umicore should see the day in the third quarter of 2007 and will employ 4,500 people with production units spread around the world: three Australia, three in China, one in Thailand, one in the United States, one in Netherlands, both in Belgium, and three in France (Auby, Galva 45 and GM Metal). The two groups are studying the possibility of introducing stock the new together at the time of its creation. "The introduction on the stock market will be based on the relative value of the respective assets", indicate the two firms. At this stage, it is not established if the rating of the joint venture will coincide with its constitution or the will follow.

Introduction on the stock exchange in 2007

According to several analysts, an introduction on the stock exchange before the third quarter of 2007 is still unlikely. However, "before the introduction in stock, the joint venture would be held at equal parts by the founding companies." "A regulation will be payment for Zinifex by debt raised by the joint venture", said the official press release. No indication was given as the sum to be paid to the Australian. In any event, "based on current data, the structure of the shareholding of the new company should highlight Zinifex 60 and 40 for Umicore," said a spokesman of Umicore. Valorization, always according to this expert, would exceed $ 2 billion. Zinifex shareholders will be asked to speak on the operation current second quarter of 2007. "Probably in April", advance specialist. Breakdown of the agreement by one of the two parties, it would be bound to pay to the other a relatively modest sum of EUR 9.5 million. Is quite rare in this area, the two firms are advised by the same bank, UBS. View on the side of Zinifex, the transaction has the undeniable advantage of reduce its exposure to refining activities that ensures 30 of the profits. Until early 2008, concentrate producers will have the last word on the refiners, given the deficit in the supply of ore.

As Umicore, the outsourcing of its assets in the refining of zinc and its alloys answers the need "to make independent activity too subject to cyclic hazard", in "les echos""" the spokesman for the Belgian group. In April 2005, Umicore had already left its perimeter copper on the basis of the listed company Cumerio (which he holds more than 2.5). On the first three quarters, this activity contributed much less to the benefits of Umicore both divisions of precious metals.