Arrium
{{Short description|Former Australian mining and materials company}}
{{Use Australian English|date=November 2020}}
{{Use dmy dates|date=September 2020}}
{{Infobox company
| name = Arrium Limited
| logo = Arrium.svg
| type = Public company
| traded_as = {{asx|ARI}}
| key_people =
| industry = Mining, mining consumables, manufacturing, recycling, and distribution
| products = Iron ore, steel products
| revenue = {{decrease}}A$6.085 billion (2015)[http://www.arrium.com/~/media/Arrium%20Mining%20and%20Materials/Files/ASX%20Announcements/FY2015/Arrium%20Limited%20Full%20Year%20Results%202015.pdf Full year results] arrium.com
| net_income = {{decrease}} (A$-1.9 billion) (2015)
| num_employees = ~10,000
| foundation = Spun off on 23 October 2000 as OneSteel from BHP Billiton. The company then changed its name on 2 July 2012 to Arrium Limited.
| fate = Acquired by Liberty House Group in September 2017 and renamed Liberty OneSteel
| location = Suncorp Place, Sydney, Australia
| locations = New Zealand, Indonesia, Chile, Mexico, USA, Canada, Peru
}}
Arrium was an Australian mining and materials company, employing nearly 10,000 workers before going into voluntary administration in 2016 with debts of more than $2 billion. In 2017 it was acquired by British-owned Liberty House Group.
History
=Establishment=
The company was spun off from BHP{{cite web|url=http://www.investogain.com.au/company/onesteel-limited|title=Onesteel Limited OST – Profile and Status at InvestoGain|work=investogain.com.au}} in 2000 as an almost entirely domestically focused steel manufacturer and distributor branded as OneSteel. Among its principal assets were the Whyalla Steelworks, Whyalla harbour and iron ore mining operations along the Middleback Range, about {{cvt|50|km}} west of Whyalla.
The company subsequently expanded its businesses in mining, mining consumables, steel, and recycling.
=Company acquisitions and sales=
In 2006, an agreement was announced under which OneSteel would buy out scrap metal company Smorgon Steel for US$1.2 billion.{{cite web|url=https://registration.ft.com/registration/barrier?referer=http://www.google.com.au/search?q=OneSteel&hl=en&lr=&safe=off&start=70&sa=N&location=http://www.ft.com/cms/s/7722920c-04cd-11db-8981-0000779e2340,dwp_uuid=0b59bffe-93ef-11da-82ea-0000779e2340.html|title=OneSteel buys Smorgon Steel for A$1.6bn|work=Financial Times}} However, concerns by competition regulator, the Australian Competition & Consumer Commission (ACCC), delayed the process, as did concerns by construction industry trade unions about possible job losses.{{cite web |url= http://www.abc.net.au/news/newsitems/200608/s1721631.htm |archive-url= https://archive.today/20080106102632/http://www.abc.net.au/news/newsitems/200608/s1721631.htm |archive-date=6 January 2008 |url-status= dead|title= Union concerned over OneSteel, Smorgon merger |author= |date= 23 August 2006 |website= Australian Broadcasting Corporation |access-date= 19 November 2020 }} The merger was completed in 2007.{{dead link|date=November 2020}}{{cite web|url=http://www.livenews.com.au/Articles/2008/02/15/OneSteel_lays_off_270_workers_unions_howl|archive-url=https://web.archive.org/web/20080224050804/http://www.livenews.com.au/articles/2008/02/15/OneSteel_lays_off_270_workers_unions_howl |archive-date=24 February 2008 |title=OneSteel lays off 270 workers, unions howl |website=livenews.com.au |url-status=dead }}
In 2008, the company announced that one of the bar mills in the Hunter Valley and the mill in Melbourne would be closed.
In 2010, OneSteel acquired two companies, Chile-based forged steel grinding balls producer Moly-Cop, and Canada-based AltaSteel, a producer of ball stock for forged grinding balls, for a total of $932 million.{{cite web|title=Australian OneSteel acquires Chile, Canada producers for $932 mil|url=http://www.platts.com/RSSFeedDetailedNews/RSSFeed/Metals/7546779|work=added acquisition|publisher=Platts|access-date=16 November 2010|archive-url=https://web.archive.org/web/20120309151517/http://www.platts.com/RSSFeedDetailedNews/RSSFeed/Metals/7546779 |archive-date=9 March 2012}}
In 2011, OneSteel acquired the iron ore assets of WPG Resources for an estimated A$320 million.{{cite news|title=OneSteel Limited Completes Acquisition of WPG Resources Limited's Subsidiary Companies|url=https://www.reuters.com/finance/stocks/ARI.AX/key-developments/article/2410937 | work=Reuters}} In the same year, OneSteel sold its Piping Systems business and associated property investments to US-based McJunkin Red Man Holding for a total of $100 million.{{cite news|title=OneSteel shares jump on sale of Piping Systems|url=http://www.theaustralian.com.au/business/companies/onesteel-shares-jump-on-sale-of-piping-systems/story-fn91v9q3-1226228606944|work=The Australian|access-date=27 March 2012|date=22 December 2011}}
The company had three primary reporting segments:
- Arrium Mining,{{cite web|url=http://www.arrium.com/our-businesses/arrium-mining|title=Arrium Mining |work=arrium.com}} which then exported about six million tonnes of hematite ore per year to China from its Middleback Range mines.{{cite web |url=http://www.adelaidenow.com.au/news/arrium-to-mothball-southern-iron-operations-that-include-peculiar-knob-mine-in-sa-flags-13bn-writedown-due-to-iron-ore-prices/news-story/a164637401cbc9c1d8586036748abbeb |title=Arrium to mothball Southern Iron operations that include Peculiar Knob mine in SA, flags $1.3bn writedown due to iron ore prices |date=23 January 2015 |author=Valerina Changarathil |newspaper=The Advertiser |publisher=News Corp |access-date=30 January 2016}}
- Arrium Mining Consumables,{{cite web|url=http://www.arrium.com/our-businesses/arrium-mining-consumables|title=Arrium Mining Consumables |work=arrium.com}} which included Moly-Cop grinding media, the largest supplier of grinding media (grinding balls and grinding rods) in the world, servicing the global mining industry, particularly the copper, gold and iron ore sectors. The business sold about 950,000 tonnes of grinding media per year in South America, North America and Australasia.
- OneSteel Steel and Recycling{{cite web|url=http://www.onesteel.com|title=Welcome|work=onesteel.com}} was a manufacturing, distribution and recycling businesses. The division manufactured long steel products, structural pipe and tube, and wire products in Australia; it distributed structural steel and reinforcing products in Australia through about 200 sites and supplied scrap metal to foundries, smelters and steel mills in Australia and internationally.
=Financial difficulties and acquisition=
The company employed nearly 10,000 workers.{{cite web|url=https://www.theguardian.com/business/2016/apr/08/arrium-the-steel-industry-and-whether-a-bailout-would-be-a-blunder|title=Arrium and the future of the Australian steel industry – four key questions|first=Shalailah|last=Medhora|date=8 April 2016|work=The Guardian}}{{Cite web|url=http://www.onesteel.com/ESR%20Report%2008%20-%20Final.pdf|archive-url=https://web.archive.org/web/20160304044358/http://www.onesteel.com/ESR%20Report%2008%20-%20Final.pdf|url-status=dead|title=Building a Strong Future, Together|archive-date=4 March 2016}}
The company, as Arrium Limited, accumulated huge debts and in 2015 it announced a full-year loss of AUD1.9 billion{{cite web|url=http://www.abc.net.au/news/2015-08-19/arrium-crashes-to-massive-loss/6708116|title=Arrium crashes to $1.9b loss on iron ore collapse|date=19 August 2015|publisher=Australian Broadcasting Corporation}} In April 2016, Arrium's directors placed the company into voluntary administration.{{cite news|title=Arrium enters voluntary administration, Grant Thornton appointed|url=http://www.abc.net.au/news/2016-04-07/arrium-enters-voluntary-administration/7306340|access-date=7 April 2016|work=ABC News|date=7 April 2016}} Soon after that, to reduce Arrium's total debt of $2.8 billion, administrators signed a sale agreement for AUD1.6 billion to sell the Moly-Cop grinding media business – the company's only profitable division, which was not under administration.{{cite web |url= https://www.sbs.com.au/news/arrium-s-molycop-sold-for-1-6-billion |title= Arrium's MolyCop sold for $1.6 billion |author= |date= 11 April 2016 |website=SBS World News|access-date= 19 November 2020 }}
In September 2017, British-owned GFG Alliance acquired the Arrium Mining and Arrium Steel businesses, including Australia's main steel manufacturer and distributor, OneSteel.{{Cite news |url=https://www.forbes.com/sites/chrystanpaul/2018/03/21/why-sanjeev-gupta-may-just-be-the-worlds-most-ambitious-industrialist/ |date=21 March 2018 |first=Chrystan |last=Paul |title=Why Sanjeev Gupta may just be the world's most ambitious industrialist |work=Forbes}} The OneSteel brand was changed to Liberty OneSteel and Arrium Mining was renamed SIMEC Mining.{{cite web |url= https://www.libertyonesteel.com/announcement/ |title= GFG Alliance has completed the acquisition of the Arrium Mining and Steel businesses |website= Liberty OneSteel | author= |date= 1 September 2017|access-date= 17 September 2017}} The acquisition also included the Australian reinforcing company, Austube Mills; the Australian rail stockist Emrails; and product brands such as Waratah and Cyclone.
OneSteel lost A$120m in the 2017 financial year, and $195m in the following year. Gupta said that he had invested money in the company, including plans to upgrade the plant at Whyalla{{cite news|website=The Guardian|url=https://www.theguardian.com/australia-news/2019/oct/19/journalists-are-annoying-sanjeev-gupta-on-whyalla-and-its-fundamental-problems|title=Trouble at the mill: Sanjeev Gupta on Whyalla and its 'fundamental problems'|first=Ben|last=Butler|date=19 October 2019}} which included a A$700m solar, battery, and pumped hydro project to power the steelworks, via Zen Energy, another GFG Alliance subsidiary.{{cite web | last=Wahlquist | first=Calla | title=Whyalla steelworks to be powered by $700m solar, battery and pumped hydro project | website=The Guardian | date=31 October 2017 | url=https://www.theguardian.com/australia-news/2017/oct/31/whyalla-steelworks-to-be-powered-by-700m-solar-battery-and-pumped-hydro-project | access-date=22 February 2025}}
Whyalla iron ore export
File:Iron ore exports from Whyalla, South Australia (2007-2014).PNG
In 2007, OneSteel commenced iron ore export from the port of Whyalla via transshipment. In October 2012, a new dual gauge railway balloon loop was commissioned at Whyalla with the purpose of increasing Arrium's iron ore export capacity to 12 million tonnes per annum.Railexpress.com.au [http://www.railexpress.com.au/archive/2012/november/november-7th-2012/top-stories/arrium-calls-for-interstate-track-upgrade/?searchterm=None "Arrium calls for interstate track upgrade"] {{webarchive|url=https://web.archive.org/web/20131203010002/http://www.railexpress.com.au/archive/2012/november/november-7th-2012/top-stories/arrium-calls-for-interstate-track-upgrade/?searchterm=None |date=3 December 2013 }} (7 November 2012) Retrieved 25 November 2013.
Arrium's iron ore export volumes from Whyalla peaked at 12.5 million tonnes per annum in 2013–14 and 2014–15. In March 2015, Arrium's Southern Iron project, which includes the Peculiar Knob mine, was mothballed. Export volumes were expected to drop to between 9 and 10 million tonnes in 2015–16 and again to between 6 and 8 million tonnes from 2017.{{Cite book|title = Arrium Limited Annual Report 2015|publisher = Arrium Ltd|year = 2015|pages = 15|url = http://www.arrium.com/~/media/Arrium%20Mining%20and%20Materials/Files/ASX%20Announcements/FY2015/2015%20Annual%20Report.pdf}} In October 2015, the company announced that it was working with the South Australian government to facilitate third party use of the Whyalla harbour to make use of its excess capacity.{{Cite web|title = SA government to work with Arrium to turn Whyalla into a multi-user export port {{!}} www.engineersaustralia.org.au|url = https://www.engineersaustralia.org.au/portal/news/sa-government-work-arrium-turn-whyalla-multi-user-export-port|website =Engineers Australia|access-date = 30 January 2016}}
See also
References
{{Reflist}}
External links
- {{Official website|https://www.infrabuild.com/|Infrabuild}} (formerly OneSteel)
{{BHP}}
{{Authority control}}
Category:Steel companies of Australia
Category:Companies formerly listed on the Australian Securities Exchange
Category:Companies based in Sydney
Category:Mining companies of Australia