Chinese consortium acquires 15-% stake in Brazilian niobium producer CBMM for $1.95 bn
05 September 2011
A consortium of five Chinese companies has acquired a 15 per cent stake in Brazil's Companhia Brasileira de Metalurgia e Mineracao (CBMM), the world's biggest niobium producer, for $1.95 billion in cash.
Chinese state-owned investment company CITIC Group and Chinese steelmakers Baosteel Group, Anshan Iron & Steel Group, Shougang Corporation and Taiyuan Iron & Steel Group Co, formed a consortium, China Niobium Investment Holdings Ltd, to acquire a minority stake in CBMM from the Moreira Salles family, one of Brazil's richest banking families.
Brazil holds the largest proven niobium reserves in the world and CBMM is the world's largest niobium producer.
Niobium is a rare with no replacement, used to strengthen steel and in the production of high-grade steel products such as automobiles, infrastructure construction, oil and gas transmission pipelines, large structures such as bridges, towers and buildings, and aircraft engines.
The 15-per cent stake acquisition by the Chinese consortium comes five months after a group of four Japanese and two South Korean companies bought a combined 15 per cent stake in CBMM for about $1.8 billion in March.
The companies are JFE Holdings, Nippon Steel, Sojitz Corp and Japan Oil, Gas & Metals National Corp and South Korea's National Pension Service and steelmaker Posco.
The Moreira Salles family will now hold 70 per cent in CBMM, which has annual revenues of around $1.83 billion.