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Trafigura Among Sixto Enter BHP Nickel Sale, Review Says

Trafigura Beheer BV and Sherritt International Corp. (S) are among six companies to enter the sale process for BHP Billiton Ltd.’s Australian nickel unit, according to a report from the Australian Financial Review.

Glencore Plc, X2 Resources, Jinchuan Group Co. and MMG Ltd., a unit of China Minmetals Corp., are also among bidders that have started due diligence on BHP’s Nickel West business, the newspaper reported today, without saying where it got the information. Emily Perry, a Melbourne-based spokeswoman for BHP, declined to comment in an e-mailed response.

BHP said in May it’s considering selling all or part of its Australian nickel unit as prices surge amid an Indonesian export ban on the steel hardening agent. The due diligence process may take months and BHP is keen to finalize a deal by the end of the year, the newspaper said. The business may be worth more than A$800 million ($749 million), according to the newspaper.

Michael Oke, a spokesman for London-based X2 Resources, Francis de Rosa, a Sydney-based spokesman for Glencore, and Kathleen Kawecki, a Melbourne-based spokeswoman for MMG, didn’t immediately respond to e-mails sent outside of normal business hours seeking comment on the sale process. Three calls to Gao Tianpeng, the general manager of Jinchuan’s asset operation department, went unanswered.

Amsterdam-based Trafigura and Toronto-based Sherritt didn’t immediately respond to e-mails seeking comment.

Nickel Rally

Nickel has advanced about 40 percent this year in London after Indonesia, the biggest producer of the metal, banned raw-ore exports in January to encourage local refining. BHP Chief Executive Officer Andrew Mackenzie has said he wants to run a smaller collection of assets with long lifespans.

X2 Resources, led by former Xstrata Plc CEO Mick Davis, had its bid for BHP’s Australian nickel business rejected as too low, the Globe & Mail reported last month. Glencore said in March it was assessing a bid for the assets.

BHP booked impairment charges on the Nickel West assets of almost $1.6 billion in the past two financial years after prices for the metal fell. The operations produced 103,300 metric tons in financial 2013. The unit includes the Mt Keith, Cliffs and Leinster mines and concentrators, the Kalgoorlie smelter, Kambalda concentrator and the Kwinana refinery.

To contact the reporter on this story: Ben Sharples in Melbourne at bsharples@bloomberg.net

To contact the editors responsible for this story: Stanley James at sjames8@bloomberg.net Robert Fenner, Garry Smith

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