BHP Billiton divested of aluminum and nickel

BHP Billiton, one of the world's largest mining giants, has issued a message indicating that its management is going to sell part of the assets. The board of directors at the next meeting this week plans to consider reducing the huge portfolio formed in 2001 as a result of the merger of the British corporation Billiton and the Australian giant Broken Hill Proprietary. It is planned to abandon nickel, manganese and aluminum. In turn, BHP Billiton wants to focus on the extraction of oil, coal, iron ore and copper. The issue of the work of projects in the field of potash production is also being considered.

This is not the first sale of assets. Back in 2012, the company “simplified” its business by selling a copper mine, a Canadian diamond mine and a uranium project in Australia.

The message does not indicate to whom it is planned to sell the assets, but the moment was chosen more than well. Since Indonesia has imposed a ban on the export of nickel ore, as well as bauxite, now their value is increasing. It should also not be forgotten that the world has recently experienced a deficit of aluminum for the first time.

The sale by BHP Billiton of part of the business looks quite logical, since out of $ 66 billion in annual profit, aluminum, nickel and manganese brought in only $ 9.2 billion. In addition, the profitability of deposits (ore, bauxite, nickel) is considered average. Therefore, their sale will allow the company to increase the group's free cash flows, as well as provide a faster return on investment.