ArcelorMittal not alone in pressure to sell stakes in iron assets: analysts by Ross Marowits, The Canadian Press Posted Oct 19, 2012 4:33 pm MDT AddThis Sharing ButtonsShare to TwitterTwitterShare to FacebookFacebookShare to RedditRedditShare to 電子郵件Email MONTREAL – Steelmaker ArcelorMittal is reportedly looking to sell a minority ownership stake in its Quebec iron ore assets amid low prices and weak Chinese demand, an environment that analysts say will prompt other players large and small to consider similar moves.“I think conditions are challenging and I would suspect that we could see more of these types of situations where maybe there’s some partial sales of ownership,” says Anthony Rizzuto, a New York analyst for Dahlman Rose.Iron ore prices have been on a roller coaster ride, falling sharply from nearly US$200 per ton early last year to about US$87 in September, only to increase to about US$115 on Friday.Companies that are mostly likely considering their options are feeling the strain of higher costs which has removed some of their financial flexibility over the last six to 12 months. Smaller companies have been “in the crosshairs” because they have a harder time accessing capital to finance development projects.“Given a lot of uncertainty in the global macro landscape with regard to China and Europe and the United States, I think that companies are just being a little bit more careful,” he said pointing to many iron ore producers deciding to slow down their development projects.ArcelorMittal has a portfolio of more than 20 mines in operation and development.It declined to comment Friday on published reports saying that it is exploring parting with perhaps a 30 per cent stake in its Mont Wright mine, acquired as part of its 2006 takeover of Dofasco.The move could generate an estimated $2 billion to $3 billion that would help reduce the company’s US$22 billion debt as it tries to ward off further credit ratings downgrades and restore its investment grade rating with Standard & Poor’s.Industry analysts say potential buyers could range from private equity investors to Asian steelmakers.They say attracting partners could also help to fund ArcelorMittal’s (NYSE:MT) plans announced in May to spend $2.1 billion to expand annual production to 24 million tons from 14 million tons by 2013 at the facility near Labrador.Rizzuto said steelmakers in Japan, China, South Korea and India could be interested because they are looking to “gain a level of backward integration into raw materials.”Although costs to ship ore from Canada to their plants is higher than from Australia, he said the rates aren’t “egregious” at this point.“I wouldn’t rule out an investment opportunity by other possible buyers such as perhaps private equity groups, but certainty I think it would be much more viewed to be strategic in nature for someone looking to gain a better stronghold in raw material positioning.”New York-based analyst Charles Bradford of Bradford Research said some may view having an internal supply of ore as a hedge to global spot prices, but notes there remains a large cost advantage from buying ore from Australia.“If I were the Chinese I wouldn’do it because why incur political hassles for iron ore when maybe you’re more interested in getting oil,” he said.Bradford also expects to see a lot of deals in the iron ore sector in the months ahead because of rising costs, strong currencies in Canada and Australia, low ore prices and waning Chinese demand.“There’s a lot of bloom off the rose, if you will, and some of the smaller iron ore mining companies are having trouble getting cash these days,” he said in an interview.“I think we’re going to have a lot of scrap steel deals because some of the scrap dealers are really hurting and I think some of the smaller mining companies are having problems now that prices are down a lot.”ArcelorMittal has been selling some non-core assets to reduce its debt and offset the impact of declining steel demand in their core market in Europe.Morningstar analyst Bridget Freas said she’s a bit surprised by its apparent interest in selling a minority stake in the Quebec iron ore assets because it’s not something the company has previously discussed.But she said it’s not a reflection on the quality of the Quebec assets or Arcelor’s commitment to them. Freas said the primary goal is to reduce debt and restore its investment grade credit from S&P, which announced a downgrade in August.“I think that is the motivation here because these are assets that are relatively low-cost and they definitely have the use for the iron ore coming out of there,” she said from Chicago.
by Aleksandra Sagan, The Canadian Press Posted Jul 5, 2016 9:01 am MDT Last Updated Jul 6, 2016 at 8:20 am MDT AddThis Sharing ButtonsShare to TwitterTwitterShare to FacebookFacebookShare to RedditRedditShare to 電子郵件Email BlackBerry says it will end production of BlackBerry Classic smartphone BlackBerry says it will stop making its BlackBerry Classic smartphone, less than two years after launching it. THE CANADIAN PRESS/Graeme Roy TORONTO – BlackBerry is hanging up on the Classic, less than two years after it launched the smartphone in an effort to keep its grip on customers who favoured its standard keyboard.The decision to stop making the device comes as BlackBerry faces calls to get out of its money-losing hardware business altogether and instead focus solely on its burgeoning software technology — calls it has so far brushed aside.“The Classic has long surpassed the average lifespan for a smartphone in today’s market,” Ralph Pini, the company’s chief operating officer and general manager for devices, said in a company blog post dated Tuesday.The BlackBerry Classic hit the market in December 2014, offering customers a 3.5-inch screen — 60 per cent larger than the previous BlackBerry Bold 9900 that it was modelled after, only with more modern touches such as a longer battery life and, in addition to a keyboard, a touch screen.BlackBerry (TSX:BB) said consumers tend to upgrade within a year to 1 1/2 years after purchasing a phone, while companies keep theirs between three and four years.The Waterloo, Ont.-based firm will now focus on updating its smartphone lineup, Pini said.“We are ready for change so we can give our customers something better,” he said.The company will continue to support its BlackBerry 10 operating system with software updates, with a new version scheduled for release in August, he added.BlackBerry is expected to release two new mid-range, Android-powered smartphones before the end of February. CEO John Chen has said one will feature a touch screen. More information on the devices is expected this month.In its first quarter, its most recent, BlackBerry sold roughly 500,000 smartphones, about 100,000 fewer than in the previous quarter. Despite the lacklustre results, the company has no plans to stop making the Priv, the Android-power phone it released late last year.BlackBerry’s decision to continue to make new models seems to be a penetration tactic, said Marc-David L. Seidel, an associate professor at the University of British Columbia’s Sauder School of Business.“It would not surprise me if they moved further away from hardware and more towards the software back end for the secured communications,” he said, adding that BlackBerry may still offer a few smartphones preloaded with the software they are trying to push.Chen has said he believes a new venture to license BlackBerry’s mobile software to other companies can help turn its mobile business segment profitable this fiscal year, which ends in February.Seidel said that approach could become profitable for the company as it is still perceived to have a competitive advantage in security software, but it would have to move quickly as they face a lot of competition in that area.“Their best chance of survival going forward would be to focus more on the software side,” said Seidel.Follow @AleksSagan on Twitter.