ArcelorMittal today announces that it will acquire Wabush Mines, an iron ore and pellet producer in northeastern Canada.
The company will exercise the option ("right of first refusal") that its Dofasco subsidiary had on the Wabush Mines Joint Venture. Dofasco, which already held 28.6% of the mining venture, will acquire the interests of Stelco (44.6%) and Cleveland Cliffs (26.8%) on the same terms as those offered by Consolidated Thompson on June 6th, 2007. These terms include a cash element of around USD 67 million and certain liabilities. As a result, ArcelorMittal will own 100% of the mining company. The transaction, which is subject to regulatory approval, is expected to be finalised by December 2007.
Wabush produces concentrates at its Scully mine in Wabush (Newfoundland &Labrador). The concentrate is transported by rail to its Pointe Noire pelletizing and port facility located on the north shore of the St. Lawrence River. Yearly production of pellets is approximately 4.8 million tonnes. Wabush's mine and port operations are close to those of QCM (Québec Cartier Mines), a mining subsidiary of Dofasco.
Malay Mukherjee, member of ArcelorMittal's Group Management Board in charge of Mining, said: "The acquisition of Wabush Mines and facilities will enable us to exploit the synergies with the Group's existing QCM operations to increase overall pellet production in the medium term by about 3.5 million tonnes per year. This will bring ArcelorMittal closer to its stated objective of 75% iron ore self-sufficiency