Reorganisation at C.G.F.A.

Press, 17 September 1976, Page 16

Reorganisation at C.G.F.A.

PA Sydney Consolidated Gold Fields Australia, Ltd, is quitting its present unprofitable and potentially expensive iron ore interest in the Pilbara. At the same time, east will join west in its mineral sands operations through the merger of 57.1 per cent-owned Associated Minerals Consolidated, Ltd, and 77.4 per cent-owned Western Titanium, Ltd, into one unit. The two major and separate developments were announced in Sydney last night, nearly 12 hours after news of the iron ore deal had leaked from the United States. The iron ore move is a further step in the restructuring of corporate interests in the Mount Goldsworthy joint venture.

This might lead eventually to direct participation by the Australian public and Japanese steel mills, if the venture wins a Japanese sales contract. big enough to launch its huge Area C iron ore project.

Mount Goldsworthy at present is equally owned in onethird shares by C.G.F.A., Utah Development Company, and Cyprus Mines Corporation, but late last month M.I.M. Holdings, Ltd, agreed in principle to take a 20 per cent interest, reducing the C.G.F.A. and Cyprus holdings each to 23.3 per cent. This reshuffle would have lifted the indirect Australian equity in the project from about 13.6 per cent to around 19.5 per cent. Under the further reshuffle announced yesterday, however, C.G.F.A. and Cyprus will each sell their 23.3 per cent interests to C.G.F.A.’s United Kingdom parent company, Consolidated Gold Fields, for an equally divided initial cash payment of $22.3 million. A further "substantial” but yet unquantified payment will be made to the two companies if and when a decision is made to go ahead with Area C development.