Vale has granted an exclusivity period to a new potential buyer for its metallurgical plant but the customary laeders do not agree with that.
The takeover of the Brazilian company Vale’s metallurgical plant has not stopped causing a stir. Early last week, Vale’s management has officially explained that it refused the takeover offer from the Sofinor/Korea zinc* consortium.
In a press release, published on November 5, Vale gave details about a new potential buyer. Ans the financial package is quite unsusual. The Southern Province of New Caledonia, where the plant is located, should hold 20% of the company. The employees could hold 23%. Traigura, the Swiss company specialized in oil brokerage, would hold 25%. And last but not least, an investment company called Compagnie Financière de Prony would also hold 25% of the company.
No industrial partner
The investment is at a level of $1.2 billion. 60% is contributed in equity and 40% by bank loan. The project also foresees that in 2021, 7% of the capital will be offered to all Caledonians. A project that raises several questions. The first of them is that the financial package does not include any industrial partner. No nickel specialist can imagine that such a plant would be able to operate in the long term without an industrial partner. However, there are only a handful of specialists in the world (including Korea Zinc…).
Customaries threaten to block
The other question raised by this recovery project is related to the customary people. They are stakeholders in this factory. In particular, they have signed a 30-year agreement with Vale. A pact that provides actions for the environment (including reforestation) or staff training.
The customary owners, gathered in an organization called Ican (a customary indigenous negotiating body) have stated very clearly that they would block the plant if the Trafigura proposal is chosen by Vale.
Our colleague from New Caledonia’s only daily newspaper, Les Nouvelles calédoniennes, reports in the 5 November edition the position of an elected separatist, Raphaël Mapou : “The people won’t let go.”
Nothing is done yet. And the Trafigura project has until December 4 to be finalized.
*Sofinor is a new caledonian company that controls two nickel plants in New Caledonia and in South Korea. Korea Zinc is a south korean metallurgist.
Photo > New caledonian plant of Vale, in Southern province. Credits: Supplied.