2.2 |
Exxaro – Corporate Structure and Business Structure, History and Strategy
2.2.1 |
Corporate and Business Structure
Exxaro is a public listed company. Its primary listing is on the JSE Limited (“JSE”) and it has an American Depositary Receipt (“ADR”) programme on the New York Stock Exchange, Inc (“NYSE”). Kumba Iron Ore is a company to be listed on the JSE. The principal executive offices of Exxaro are located at Kumba Limited, Roger Dyason Road, Pretoria West, 0001, Pretoria, Gauteng Province, Republic of South Africa.
Exxaro and its subsidiaries conduct underground and/or surface mining and related activities, including exploration, development and operation of mines, metallurgical processing, smelting and refining. Exxaro’s ownership comprises holdings in Direct Subsidiaries, Indirect Subsidiaries, Joint Ventures (Direct and Indirect) and Associate Companies (Direct and Indirect). These subsidiaries, joint ventures and associate companies comprise dormant companies, exploration companies, mining companies, investment holding companies, marketing companies, mineral rights holding companies, mining related service companies and property holding companies.
Exxaro’s operational structure will be based on five reporting entities: Base Metals; Industrial Minerals; Heavy Minerals; Iron Ore and Coal. Exxaro’s corporate structure is depicted in
Figure 1.3 [70 KB].
In South Africa, Exxaro and its subsidiaries have 12 producing mines, six projects, three smelters/plants, five coal processing plants and one coal destoning plant.
In Australia, Exxaro will operate the Tiwest JV in association with Kerr McGee, and has the Moranbah South coal project. In Namibia, Exxaro operates the Rosh Pinah mine. In Madagascar, Exxaro has an option to acquire the Toliara Sands Project. Kumba Iron Ore has two operating mines and two projects.
|
2.2.2 |
History
Exxaro was incorporated and registered as a public company in the Republic of South Africa in June 2000 and listed on the JSE on 26 November 2001 following the unbundling of Kumba from Mittal Steel South Africa Limited (“Mittal Steel”), formerly Iscor Limited (“Iscor”). Table 2.1 provides a brief description of the significant milestones in the history of Exxaro.
| Table 2.1 |
Historical Milestones |
| Date |
Activity |
| 1932 |
Thabazimbi Iron Ore Mine commences mining operations. |
| 1953 |
Sishen Iron Ore Mine commences mining operations. |
| 1955 |
Acquisition of Durban Navigation Collieries. |
| 1969 |
Rosh Pinah Lead-Zinc Mine commences mining operations. |
| 1976 |
Sishen Iron Ore Mine commences export of iron ore via recently completed railway line to
Saldanha Bay. |
| 1980 |
Grootegeluk Coal Mine commences mining operations. |
| 1983 |
Tshikondeni Coal Mine commences mining operations. |
| 1989 |
Iscor is privatised and listed on the JSE. |
| 1992 |
Leeuwpan Coal Mine commences mining operations. |
| 1995 |
Acquisition of a 35% shareholding in Ticor Limited of Australia. |
| 1996 |
Acquisition of interest to conduct a feasibility study on the Hope Downs exploration property. |
| 1996 |
Commencement of major re-engineering and transformation programme. |
| 1998 |
Acquisition of remaining 65% interest in Zincor Limited from Gold Fields of
South Africa. |
| 1999 |
Increase shareholding in Ticor Limited of Australia to 43.4%. |
| 2000 – 20 November |
Iscor shareholders approve the process of putting assets into separate legal entities. |
| 2001 |
Sale of 40% of Kumba’s interest in the Heavy Minerals Project to Ticor Limited. |
| 2001 |
Divestment of gold exploration interests in exchange for an interest in Mincor Resources NL. |
| 2001 – 1 March |
Announcement of restructuring. |
| 2001 – April |
Increase in shareholding in Ticor Limited of Australia to 43.8%. |
| 2001 – 26 November |
Kumba (Iscor Mining division) unbundled and separately listed on the JSE. |
| 2003 |
Anglo American becomes Kumba’s majority shareholder. |
| 2005 – 13 October |
Announcement of the transaction that will result in the creation of Exxaro and Kumba Iron
Ore. |
| 2005 – 22 November |
Take-out of Ticor Limited minority shareholders through a Scheme of Arrangement. |
|
|
2.3 | Background
SRK is a subsidiary of the international group holding company, SRK Group. SRK has been commissioned by the directors of Kumba to prepare a CPR on the Material Properties which will be incorporated into Exxaro and Kumba Iron Ore.
The description of the transaction is summarised in Section
1.2.1.
| Table 2.2 Salient Historical Operating Statistics |
| IRON ORE |
|
2002(F) |
2003(F) |
2003(H2) |
2004(C) |
2005(C) |
| Production |
|
|
|
|
|
|
| Sishen Mine |
(Kt) |
25,903 |
26,168 |
13,470 |
27,609 |
28,458 |
| Thabazimbi Mine |
(Kt) |
2,421 |
2,389 |
1,270 |
2,503 |
2,530 |
| Total |
(Kt) |
28,324 |
28,557 |
14,740 |
30,112 |
30,987 |
| Sales |
|
|
|
|
|
|
| Sishen Mine exports |
(Kt) |
19,916 |
20,946 |
10,004 |
20,923 |
22,113 |
| COAL |
|
|
|
|
|
|
| KUMBA COAL |
|
|
|
|
|
|
| Coking Coal |
|
|
|
|
|
|
| Production |
|
|
|
|
|
|
| Grootegeluk Mine |
(Kt) |
1,670 |
1,830 |
884 |
1,972 |
1,859 |
| Tshikondeni Mine |
(Kt) |
404 |
377 |
193 |
437 |
414 |
| Total |
(Kt) |
2,074 |
2,207 |
1,077 |
2,409 |
2,273 |
| Thermal Coal |
|
|
|
|
|
|
| Production |
(Kt) |
13,351 |
13,036 |
7,201 |
14,017 |
14,573 |
| Sales to Eskom |
(Kt) |
13,198 |
13,051 |
7,154 |
14,356 |
14,703 |
| Other Coal |
|
|
|
|
|
|
| Production |
|
|
|
|
|
|
| Grootegeluk Mine |
(Kt) |
1,194 |
1,313 |
628 |
1,403 |
1,551 |
| Leeuwpan Mine |
(Kt) |
1,631 |
1,456 |
845 |
1,615 |
1,442 |
| Total |
(Kt) |
2,825 |
2,769 |
1,473 |
3,018 |
2,993 |
| EYESIZWE COAL |
|
|
|
|
|
|
| Thermal Coal |
|
|
|
|
|
|
| Production |
|
|
|
|
|
|
| Arnot Colliery |
(Kt) |
4,924 |
5,629 |
3,074 |
6,019 |
4,976 |
| Matla Colliery |
(Kt) |
12,548 |
14,167 |
7,761 |
15,528 |
12,425 |
| New Clydesdale Colliery |
(Kt) |
853 |
1,003 |
519 |
1,108 |
1,185 |
| North Block Complex |
(Kt) |
980 |
1,428 |
859 |
2,518 |
3,063 |
| Total |
(Kt) |
19,305 |
22,227 |
12,212 |
25,173 |
21,649 |
| HEAVY MINERALS |
|
|
|
|
|
|
| Ticor SA |
|
|
|
|
|
|
| Production |
|
|
|
|
|
|
| Ilmenite |
(Kt) |
44 |
91 |
87 |
262 |
358 |
| Zircon |
(Kt) |
45 |
53 |
25 |
49 |
47 |
| Rutile |
(Kt) |
19 |
20 |
9 |
20 |
23 |
| Low manganese pig iron |
(Kt) |
|
3 |
12 |
63 |
89 |
| Scrap pig iron |
(Kt) |
|
|
3 |
5 |
8 |
| Chloride slag |
(Kt) |
|
|
13 |
96 |
134 |
| Sulphate slag |
(Kt) |
|
|
10 |
40 |
30 |
| Ticor(1) |
|
|
|
|
|
|
| Production |
|
|
|
|
|
|
| Ilmenite |
(Kt) |
223 |
214 |
109 |
236 |
220 |
| Zircon |
(Kt) |
39 |
40 |
19 |
38 |
35 |
| Rutile |
(Kt) |
15 |
18 |
9 |
18 |
16 |
| Leucoxene |
(Kt) |
9 |
13 |
5 |
11 |
12 |
| Synthetic rutile |
(Kt) |
89 |
90 |
56 |
112 |
111 |
| Pigment |
(Kt) |
46 |
47 |
27 |
54 |
53 |
| BASE METALS |
|
|
|
|
|
|
| Zinc |
|
|
|
|
|
|
| Production |
|
|
|
|
|
|
| Rosh Pinah (zinc concentrate) |
(Kt) |
75 |
91 |
54 |
124 |
126 |
| Zincor (zinc metal) |
(Kt) |
105 |
115 |
55 |
104 |
102 |
| Chifeng (zinc metal)(2) |
(Kt) |
|
|
3 |
12 |
15 |
| Rosh Pinah (lead concentrate) |
(Kt) |
28 |
22 |
18 |
27 |
25 |
| INDUSTRIAL MINERALS |
|
|
|
|
|
|
| Glen Douglas |
|
|
|
|
|
|
| Production |
|
|
|
|
|
|
| Dolomite |
(Kt) |
543 |
642 |
327 |
653 |
689 |
| Aggregate |
(Kt) |
650 |
586 |
302 |
705 |
666 |
| Lime |
(Kt) |
99 |
99 |
36 |
73 |
26 |
(1)
|
Ticor was consolidated from 1 April 2003. The production tonnes reflect Ticor’s 50% interest in its Tiwest JV joint venture. Physical information provided for periods prior to consolidation are for comparative purposes only. |
| (2) |
The effective interest in the physical information of the Chifeng refinery has been disclosed. |
| (F) |
Financial Year ended 30 June. |
| (H2) |
Six months ended 31 December due to the change of Financial Year. |
| (C) |
Calendar Year ended 31 December. |
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