Outokumpu (OUTOF-O) has put its copper businesses up for sale.
It plans to divest itself of copper products and concentrate on the stainless steel business. It will use Merrill Lynch as its financial advisor for the transactions.
Outokumpu is currently one of the top-four largest producers of stainless steel in the world and Europe’s third largest zinc producer.
Stainless steel accounts for 80% of Outokumpu’s operating capital and two thirds of its net sales.
In January Boliden (BLS-T) took over Outokumpu’s zinc and copper mining and smelting operations. Outokumpu took over Boliden’s fabrication and technology sales operations (Outokumpu owns 49% of the new Boliden).
The new Boliden is Europe’s largest copper producer (eighth largest in the world). In 2003 Outokumpu’s Harjavalta Metals produced 161,000 tonnes of blister copper and 126,000 tonnes of cathode copper. The cathode copper production was up 11,000 tonnes from the previous year however operating profit was down E$2 million at E$12 million.
In February Outokumpu bought SMI’s Italian superconducting wire manufacturing business and its ACR tube manufacturing business in China. Outokumpu is currently a leader in the manufacture of superconductor wire.
Outokumpu Copper’s net sales weakened in 2003 (almost E$1.63 million) compared with 2002 (E$1.67 million). The operating profit was E$7 million, down E$46 million from the previous year. The Appliance Heat Exchangers & Asia division posted a better year with increased net sales and an E$8 million higher profit.
Outokumpu reports that the annual growth of the stainless steel market has been 5-6% over the past two decades and that it is forecasted to continue its upward trend.
The Finnish government is a 40%-owner of Outokumpu.
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