Australian miner BHP Billiton has signed a heads of agreement with Australia-based project development company Leighton Holdings to acquire its subsidiary HWE Mining, which provides contract mining services to its Western Australian iron ore operations, for US$735 million.
To switch from contract mining to in-house operations in its Western Australian iron ore business, BHP Billiton has decided to buy HWE Mining which mines the Area C, Yandi and Orebody 23/25 operations of BHP.
BHP Billiton stated that, with this acquisition, the company will remove complexity and costs. The purchase transaction is expected to close during the fourth quarter of 2011, subject to definitive agreements and regulatory approvals.