NZ Steel sale to go ahead

Press, 8 June 1989, Page 30

NZ Steel sale to go ahead

PA Wellington Equiticorp’s statutory manager, Mr Fred Watson, said the political upheaval in China would not change the sale of New Zealand Steel to the Chinese Minmetals corporation.

Mr Watson said in a brief statement Equiticorp still had a sale agreement with Minmetals and settlement was due on June 30. The statement was a response to calls for the deal to be stopped as part of a New Zealand protest at the massacre of student

protesters by the Chinese Army. Under the agreement reached with Minmetals in April, the huge Chinese Government-owned corporation will buy 80% of New Zealand Steel from Equiticorp and 20% from Fisher and Paykel Industries. The shareholding is a major asset of the failed Equiticorp group, which initially bought an 89% stake from the Government in 1987. Minmetals outbid New Zealand’s largest company Fletcher Challenge,

which has a big steel business including this country’s only other steel mill, Pacific Steel in Onehunga. New Zealand Steel’s Glenbrook mill produces iron from iron sands on the west coast of the North Island. Developed since the mid 19605, the mill has been expanded in recent years with technology making it one of the most advanced in the Southern Hemisphere. Minmetals is a large multi-national conglomerate, dealing in steel and

other commodities, and involved in construction in China. When the sale of NZ Steel was announced, the Minister for Overseas Trade, Mr Moore, hailed it as a dramatic widening of the economic relationship between China and New Zealand. At Minmetals’ insistence, the sale price negotiated with the Equiticorp managers and Fisher and Paykel has been kept a secret. Fisher and Paykel has indicated the sum may be disclosed on June 30.