The aluminum smelter said on Tuesday the purchase consideration by its 80% owned Press Metal Bintulu Sdn Bhd was based on the continuous cash flow generation capabilities of JAA in the near future and further supported by the JAA's net asset position.
In its reply to a query from Bursa Malaysia Securities, it said JAA's net position as at Dec 31, 2017 was the net assets of A$274.68mil and shareholder loan of A$216mil totalling A$490.68mil.
Press Metal Bintulu's 50% share would amount to A$137.34mil net assets and shareholder loan of A$108mil totalling A$245.34mil.
It also said JAA's audited net profit at Dec 31, 2017 was A$13.64mil and net assets A$274.33mil.
On Oct 17, Press Metal announced Press Metal Bintulu had inked a deal with Itochu Minerals & Energy of Australia Pty Ltd (IMEA) and the holding company Itochu Corporation to acquire the 50% equity interest in JAA for A$250mil.
Itochu Corp holds 96.3% of IMEA and Itochu Australia Ltd the remaining 3.7%.
JAA holds 10% participation interest in the Worsley Alumina unincorporated joint venture which owns and operates the Worsley Alumina Project, one of the world’s largest, longest life and lowest cost alumina producers.
Press Metal had then said the proposed acquisition would enable it to access 5% of the annual production of the Worsley Alumina project which amounts to 230,000 metric tonnes of alumina per annum.
It added then the acquisition would ensure Press Metal’s long-term access to raw material and reduces its exposure and reliance on third party suppliers. The proposed acquisition was expected to be completed by the first quarter of 2019.
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