OZ Minerals primps for suitors
The Age
Friday August 28, 2009
OZ MINERALS chief executive of less than a month Terry Burgess is hoping he gets the chance to expand the now cashed-up and debt-free copper and gold producer before it becomes the subject of a takeover bid.While no one has expressed "any recent interest" in the group, Mr Burgess is aware that many potential bidders had its remaining operating asset, the Prominent Hill mine, under the microscope during OZ's debt refinancing woes.The woes are a thing of the past but its June-half result, released yesterday, bore the scars of the drastic debt restructuring which culminated in $US1.59 billion ($A1.92 billion) in operating asset sales to China's Minmetals and China Sci-Tech.The sales left OZ with $1 billion in cash at the end of June after paying off its bank debts. But a loss on the asset sales left it with a net loss of $580.7 million for the June half. The result cannot be compared with the previous corresponding period because of huge changes in the group's underlying business.OZ's preferred focus was on the performance of the Prominent Hill mine, in South Australia. Its contribution at the earnings before interest and tax level for the two months it was deemed no longer a development project was $19.4 million on revenue of $89.6 million.Mr Burgess is now working on a new strategy for OZ that he intends to take to the board in late October.He said OZ would be in a position to give the market direction on the strategy by the end of the year."We need to identify which commodities we are going to be active in and which regional areas in the world we are going to be looking at," he said."But we want to make sure that whatever we do fits into the overall strategy process that the company has started."As well as resuming a feasibility study into the underground development of the western zone at Prominent Hill, OZ has begun exploration work there and at its promising gold project in Cambodia.OZ plans to spend about $25 million on exploration work in the remainder of this year, most of it around Prominent Hill.
© 2009 The Age