A consortium involving South Korean steel major Posco has been chosen as the preferred bidder to acquire Australia-based mining and materials company Arrium.
The sales process has been carried out by Arrium’s administrator KordaMentha in partnership with investment bank Morgan Stanley.
The consortium is headed by private equity fund managers Newlake Alliance Management and JB Asset Management and is supported by Posco.
KordaMentha partner Mark Mentha said: “After a 14-month administration and a nine-month sale process, we are now an important step closer to providing certainty to employees, creditors, suppliers, customers and the Whyalla community.
“We thank all those people for their patience and support during one of Australia’s most complex administrations.”
KordaMentha stated that it will work with the Posco consortium to finalise the sales contract.
The negotiation process will include discussions with Federal and South Australian governments regarding investments in the future of Arrium’s Whyalla operations.
The consortium was chosen over UK-based Liberty House group in a bidding process for the entire company, including Whyalla.
Arrium operates two business segments, Arrium Mining and Arrium Steel.
The mining business involves iron ore export and has operations at the Middleback Ranges in South Australia.
Besides exporting, Arrium Mining supplies iron ore to the company's steelworks at Whyalla.
In January, the group completed the sale of the Arrium Mining Consumables Division (Moly-Cop), which produces forged steel grinding media.
Image: Consortium involving Posco has been selected as the preferred bidder for the acquisition of Arrium group of companies. Photo: courtesy of KordaMentha.