A ZULULAND-based BEE group, Bingelela Capital, has joined forces with leading aluminium semi-fabricator Hulamin to acquire BHP Billiton’s Bayside casthouse with a future plan of creating a lucrative aluminium hub in Richards Bay.
The landmark sale of the casthouse follows the closure of the Bayside smelter in June this year.
Isizinda Aluminium consortium, which comprises Bingelela Capital as majority 60% shareholder and Hulamin a 40% shareholder, announced the acquisition of the casthouse on Monday, with effect from 1 April 2015.
The transaction includes the sale of the casthouse, a multi-billion rand liquid metal supply contract, 17 hectares of land, equipment and the adjacent buildings associated with the casthouse.
Isizinda has further agreed to a metal supply agreement with BHP Billiton for 96 000 tons per annum of liquid metal to be transported from the nearby Hillside smelter to the Bayside casthouse. The deal is renewable after five years and valued at more than R10-billion.
‘We are delighted that Isizinda acquired the Bayside casthouse which will continue the supply aluminium slab to Hulamin,’ said CEO of Isizinda Aluminium, Sizwe Khumalo.
‘We are well placed to further develop the beneficiation of aluminium in South Africa for the benefit of all stakeholders.’
Khumalo (47), who is no stranger to the local aluminium industry, is the Immediate Past President of the Zululand Chamber of Commerce and Industry, through which he has campaigned for the beneficiation of mineral resources and commodities.
Bay aluminium hub
Isizinda, together with BHP Billiton and the Richards Bay Industrial Development Zone (RBIDZ), are evaluating further phases of development to expand the casthouse with other value added products.
This could include extrusion billet, rods, wires, rim alloys, slugs and a dross plant to support the anticipated growth of the downstream aluminium industry in South Africa.
The development of a R120-million aluminium beneficiation project in the RBIDZ is set to vigorously bolster the local economy.
‘Not only will the transaction secure our rolling slab supply from Bayside for the next five years and beyond, but it will also see the creation of an aluminium hub in Richards Bay,’ Acting CEO of Hulamin David Austin said.
‘This hub has the potential to supply liquid metal and/or castings to other manufacturers in the South African aluminium industry, thereby stimulating growth in downstream beneficiation.’
BHP Billiton will continue to operate the Bayside casthouse and to supply slab to Hulamin on an interim basis until Competition Commission approval is granted and the acquisition is implemented.
‘The sale of the casthouse reflects our vision to grow the downstream aluminium industry in South Africa and to contribute to the transformation of the economy of Richards Bay,’ said Graham Kerr, CEO elect of the new company which would be created by BHP Billiton’s proposed demerger.
