KAISER BAUXITE Company completed the sale of its partnership interest in Kaiser Jamaica Bauxite Company (KJBC) last week, the company has stated.
The 49 per cent stake will go to St. Ann Bauxite Limited, a joint venture between Century Aluminum Company and Noranda Aluminum Incorporated, both of the United States. The government of Jamaica maintains its 51 per cent stake in the company.
NEW CONTRACTS
It will be business as usual for the most part, KJBC general manager Michael Muirhead told employees prior to the change in ownership. Mr. Muirhead will remain at the helm of the new entity and most employees have been offered new contracts under the same terms as their existing ones.
While initial changes would be minimal, Mr. Muirhead said more capital investments would be made by the new owners to make the entity more efficient and productive.
Kaiser started operations in St. Ann in 1967 but the parent company filed for bankruptcy protection in 2002 faced with a weak market and pending asbestos litigation. It had to sell off various assets to pay its debts and stabilise its finances.
Along with the sale of its KJBC stake, Kaiser has also sold its interests in the alumina refinery at Gramercy, Louisiana, for a combined total of US$23 million. Century and Noranda each paid half of the purchase price.
Agreement on the sale had been reached in July, but Canadian-based Alcan Aluminium on July 5, 2004 filed a motion with the U.S. Bankruptcy Court in Delaware for an order to stop Kaiser from completing the sale. Alcan claimed it has a patent on certain aspects of the technology used by Grammercy in the alumina refining process and objected to Kaiser selling the technology.
Kaiser Jamaica Bauxite Company produces about 4.5 million tons of bauxite annually and two-thirds of this is shipped to Grammercy for processing to alumina. The Gramercy refinery has the capacity to produce 1.25 million metric tons of alumina a year and Century and Noranda each purchase about 500,000 metric tons of this alumina a year for their aluminum plants.
A POSITIVE MOVE
Bauxite is converted into alumina during its refining process, and in turn alumina is the raw material from which aluminum is produced.
"This acquisition will represent a positive move for employees in the local industry, and Jamaica, because it strengthens the prospects of long-term operation of assets that generate significant local employment and foreign exchange earnings," said Norman DaCosta, vice-president and deputy island supervisor of the National Workers Union, with responsibility for the bauxite industry, when the prospective sale was announced in July.
