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The Hotazel Manganese Mines (HMM) of South32 are located in the manganese rich Kalahari Basin in the Northern Cape South Africa. The region is home to 80 per cent of the world’s manganese ore body. (Image courtesy of South32)
Shares in BHP Billiton spin-off South32 (LON, ASX:S32) dropped 2.34% on Tuesday in Sydney after the new firm confirmed it is already planning to write down assets.
The Perth-based company plans to reduce the value of its 60% stake in its South African manganese assets, as it keeps furnaces shut due to a 20% fall in the price for the aluminum and steel making ingredient over the last year.
The new miner said in a statement that is reviewing “the fair value of its interest in the [Samancor Manganese] joint venture.”
It also announced it has delayed the restart of three of its four furnaces at the operation, noting that no permanent staff will be laid-off as a result of the temporary suspension.
South32 expects the move to have implications for the fair value of Samancor, which co-owns with Anglo American (LON:AAL), the world's largest manganese producer.
The company’s shares lost five cents, closing at A$2.09, compared to the A$2.13 it listed at in a $10.9 billion lukewarm market debut in May.
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- [Editor:Sophie]
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