WMC Resources

WMC Resources Limited was an Australian diversified mining and fertiliser company that was listed on the Australian Stock Exchange. WMC was an acronym for Western Mining Corporation. It was delisted on 29 June 2005 following a successful takeover by BHP Billiton. It was founded in 1933 as a gold miner. When it was taken over it had three main businesses:

  • A nickel mining and processing business in Western Australia.
  • A copper and uranium mine at Olympic Dam in South Australia. In 2005, this mine was estimated to contain 33% of the world's known uranium reserves.[1]
  • A fertiliser production business in Queensland, which became known as Southern Cross Fertilisers following the BHP Billiton takeover; and Hi Fert, a blending and distribution network supporting Australia's eastern states. BHP Billiton sold Southern Cross Fertilisers to Incitec Pivot Limited in May 2006 and Hi Fert to a joint venture of Elders and AWB on 5 December 2005.[2]

WMC Resources
IndustryMining
FateAcquired by BHP Billiton
FoundedLondon, 1933
Defunct17 June 2005 (2005-06-17)
Headquarters
Australia 
Productsnickel, copper, uranium
RevenueA$1273 million (2004)
Number of employees
4,863 (2005)
Websitewmc.com

History

Western Mining Corporation (WMC) was formed on 2 March 1933, during the Great Depression, when WS Robinson, the Australian-born London-based managing director of Broken Hill Associated Smelters, was able to interest several large London-based mining companies into forming syndicates to develop gold mines in Australia.[3] WMC's strategy was to use the newly emerging sciences of mining geology and related geochemistry and geophysics to find new gold deposits. It was a company based on the idea that if they applied good science to exploration, they would be successful.[4]

WMC began operations in Western Australia in December 1933 when it commenced an extensive aerial survey of the Eastern Goldfields. It acquired its first profitable mining operation in June 1935 when it took an option over a new gold discovery at Cox's Find, 43 miles northwest of Laverton.[5]

WMC pioneered district-scale aerial photography in the 1930s, flying many areas in West Australia's gold-mining districts. The hope was to identify new prospective areas near known mines. Unfortunately, the surveys failed due to poor exposures of the rocks in the nearly flat, deeply-weathered areas they flew.[4]

The company's final corporate structure before takeover was formed in 2003 by a demerger that split off the aluminium operations to form Alumina Limited, separate from what was to be known as WMC Resources (with a separate ASX code of WMR).

In 2003, the company made a profit of A$245 million, on assets of approximately A$4000 million.

The last chief executive officer of the independent company was Andrew Michelmore, and the board was chaired by Tommie Bergman. Executive Directors included Mr Michelmore and Alan Dundas. A notable previous CEO, from 1990 to 2003, was Hugh Morgan, a politically vocal CEO who spoke out about the power of trade unions, criticised the Mabo decision and native title more generally, and supported a number of other right-wing causes. Most influentially, Morgan was a member of the "greenhouse mafia," central to the campaign to prevent the Federal Government ratifying the Kyoto Protocol, or taking actions to cut emissions[6] (in collaboration with Ray Evans, WMC Executive Officer, 1982-2001).

Takeover bids

In December 2004, Xstrata, a Swiss mining company, announced a takeover offer for the company. In February 2005, the WMC board recommended that shareholders reject the offer. The government did not object to the takeover through the Foreign Investment Review Board, however a number of people (including members of the Government) expressed concerns due to the economic (and strategic) importance of the Olympic Dam resources, and the reputation of Xstrata and its major shareholder, Glencore.

The Xstrata takeover offer lapsed after a higher offer was made by BHP Billiton, with support from the WMC Resources board. On the afternoon of 3 June 2005, about 6 hours before the BHP Billiton takeover offer was due to close, it was announced that 55% of the shares had accepted the offer. This automatically (according to Australian Corporations law) extended the offer period by another 14 days to 17 June. BHP Billiton had gained control of the company.[7] On the afternoon of 17 June 2005, BHP Billiton announced that it had achieved 90.5% ownership, and would proceed to acquire the remaining shares.

The takeover has strong parallels with the takeover of North Limited four years earlier. Both were subjects of bidding wars and both were large and diversified resource companies with one special world class asset that attracted attention from across the world. In the case of North, that special asset was Robe River Iron, while for Western Mining it was the Olympic Dam copper, gold and uranium deposit.

As a result of the takeover, most of the board and the CEO resigned, and were replaced by BHP Billiton appointees. BHP Billiton Executive Director Mike Salamon took over the position of Chairman of the board, and Chris Campbell took over as interim CEO. The company name has been replaced by the BHP Billiton corporate identity, and a significant name in Australian mining history ceased to be used.[8]

References
  1. Archived 25 May 2005 at the Wayback Machine
  2. "Hi Fert Change in Ownership" (PDF) (Press release). Hi Fert. 5 December 2005. Archived from the original (PDF) on 20 August 2006. Retrieved 20 June 2006.
  3. Ralph, Gilbert M; Softley, Michael D (18 November 2007), "A Brief Illustrated History of Western Mining Corporation" (pdf), 14th National Engineering Heritage Conference 2007, Crawley, Western Australia: Engineers Australia, retrieved 7 January 2014
  4. Success in Exploration for Gold, Nickel, Copper, Uranium, and Petroleum, interview with WMC geologist Roy Woodall, 2006. 211 pp. Retrieved 16 August 2017
  5. "New Find Northwest of Laverton". Kalgoorlie Miner. 8 June 1935. Retrieved 7 January 2014.
  6. Hamilton, Clive (2007). Scorcher: the dirty politics of climate change. Black Inc. Agenda. ISBN 978-0-9775949-0-0.
  7. BHP Billiton Wins Control of WMC With A$9.2 Bln Bid (Update4) Archived 16 September 2015 at the Wayback Machine
  8. End of the line for WMC
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