Tongaat-Hulett, Anglo American and the Industrial Development Corporation have given approval to proceed with a R950 million expansion project at Hulett Aluminium. This follows Tongaat-Hulett’s announcement earlier this year of its plans to unbundle and list Hulett Aluminium on the Johannesburg Stock Exchange, thereby establishing two attractive, focused investment vehicles and creating the opportunity for BEE shareholding in both entities. BEE shareholding is expected to be introduced at the level of 25% in Tongaat-Hulett and 15% in Hulett Aluminium when the unbundling and listing takes place in 2007.
Tongaat-Hulett CEO Peter Staude said, “The expansion of Hulett Aluminium reflects the confidence of its shareholders that further value can be unlocked from the current base. This investment follows the R2,4 billion (US dollar 550 million) Rolled Products Expansion Project that came on stream in November 2000. This enabled Hulett Aluminium to grow its Rolled Products annual sales volumes from a position of some 50 000 tons, exporting less than 10% of its capacity to 3 countries to one where in the month of August its annualised sales exceeded 200 000 tons. Hulett Aluminium now exports in excess of 70% of its output to more than 50 countries. The company has achieved recognition in establishing itself as a leading global producer of high margin, technologically demanding products, inter alia winning the overall State President’s Award for Export Achievement and the MTN/Business Day Technology Top 100 Award.”
“This project is another major milestone in the growth of our business,” says Alan Fourie, Managing Director of Hulett Aluminium. “The expansion of the Pietermaritzburg facility will increase rolled products capacity by 20% to 250 000 tons per annum. The project entails the installation of additional state of the art foil rolling and plate equipment, continuous casters and upgrades to existing rolling mills. The project focuses on further enhancing the product mix, where 58% of the capital will be spent. This will result in increased sales of high margin products, especially light gauge foil and heat treated plate. Hulett Aluminium expects to maintain its profitable growth from existing operations over the next two years, followed by the benefits of the project coming on stream in 2009. This will enable Hulett Aluminium to continue unlocking value by further enhancing sales mix, growing volumes and reducing unit costs.”
Issued by: Tongaat-Hulett 12 October 2006