Miner Mount Gibson Iron Sets New Ore Pacts

Mount Gibson Iron Ltd. said three Chinese customers have defaulted on long-term iron-ore purchase agreements, but that two other buyers have agreed to step in -- albeit paying a much lower price. In addition, the new buyers, which are already shareholders, agreed to underwrite a capital-raising effort and they could end up owning as much as 40% in the Australian miner.

Mount Gibson said the new sales agreements were struck at a much lower price and its profits would take a 'material' hit in the financial year that ends June 30, 2009.

The Australian company's willingness to accept a much lower price for its ore, at least over the next couple of months, shows how quickly a global slowdown has pegged back China's economy, forcing Chinese steel mills to slow production and pushing down iron-ore prices.

Mount Gibson warned Oct. 9 that a number of customers had requested delays to hematite-ore shipments.

To guard against the impact of further defaults, Mount Gibson said it has signed supply agreements with major shareholder APAC Resources Ltd. and Shougang Concord International Enterprises Company Ltd. State-owned Chinese steel maker Shougang Corp. owns 19% of APAC and 41% of Shougang Concord.

APAC currently owns a 20% stake in Mount Gibson, which has a market value of about 300 million Australian dollars (US$199 million).

APAC and Shougang Concord have agreed to underwrite a one-for-five renounceable rights issue at 60 Australian cents a share to raise A$96.5 million. Shougang Concord also has agreed to subscribe to a placement at the same price to raise a further A$66 million.

Combined, the two groups will end up owning between 29% and 40% of Mount Gibson, depending on the uptake of the rights issue.

In light of the slowing economy, China's steel output in the fourth quarter is likely to fall by more than 20% year-to-year, a China industry official said.

In line with the slowdown, Brazilian iron-ore giant Companhia Vale do Rio Doce said Friday it would reduce iron-ore output by 30 million metric tons, or about 10% of annual production capacity.

Still, the world's biggest miner, BHP Billiton Ltd., said Monday it has no plans to cut iron-ore output, or slow expansion plans.

澳大利亚矿业企业Mount Gibson Iron Ltd.称，三家中国客户违约了长期铁矿石采购协议，不过另有两个买家已经同意取而代之──但价格要低的多。此外，这两个已是Mount Gibson股东的新买家同意认购该公司发行的股份，最终可能持有该公司至多40%的股份。

Mount Gibson称，新的销售协议价格要低得多，公司截至2009年6月30日的当前财年利润将遭受严重冲击。

这家澳大利亚公司愿意接受更低的铁矿石销售价格（至少在未来几个月），显示全球增长放缓已迅速影响到了中国经济，迫使中国炼钢厂减缓生产，从而压低了铁矿石价格。

Mount Gibson曾于10月9日警告说，一些客户已经要求推迟赤铁矿石的发货。

Mount Gibson称，为了防范更多违约带来的冲击，公司已经与大股东亚太资源有限公司(APAC Resources Ltd.)以及首长国际企业有限公司(Shougang Concord International Enterprises Co.)签订了供应协议。中国国有企业首钢集团(Shougang Corp.)持有亚太资源19%的股份以及首长国际41%的股份。

亚太资源目前持有Mount Gibson 20%的股份，市值约为3亿澳元（合1.99亿美元）。

亚太资源和首长国际已经同意以每股0.6澳元的价格认购Mount Gibson 9,650万澳元的可放弃附加股，发行方式为每5股增发1股。首长国际还同意以同样价格进一步认购6,600万澳元的股份。

根据具体认购安排，亚太资源和首长国际或将总计持有Mount Gibson 29%-40%的股份。

中国一位行业官员说，考虑到经济不断放缓，第四季度中国钢铁产量可能会较去年同期下降20%以上。

随着经济放缓，巴西铁矿石巨头淡水河谷公司(Companhia Vale Do Rio Doce)上周五称，将把铁矿石产量减少3,000万吨，相当于年产能的大约10%。

尽管如此，世界最大的矿业企业必和必拓(BHP Billiton Ltd.)周一表示，没有削减铁矿石产量或是放缓扩张的计划。