Portman board shifts ground

THE board of local iron-ore miner Portman Mining, excluding chairman George Jones, has endorsed the latest takeover offer from US-based Cleveland Cliffs that increased the bid from $3.40 to $3.85 per share.

The new bid was negotiated by the Portman board following a 71.5 per cent iron-ore price rise settlement deal struck by Brazilian-based CVRD with a Japanese steel mill. This price development prompted the board to reconsider its approval of the first Cleveland Cliffs’ bid.

However, Mr Jones has refused to endorse the latest $685 million offer on the belief that the commodity’s value has more longevity than some analysts predict.

This comes after Portman enjoyed a strong net profit result of $32.8 million for the calendar year, up 51 per cent on the previous year.

The miner’s Koolyanobbing iron ore project returned a solid increase in production, processing 5 per cent more ore to 5.19 million tonnes over the period. And the company’s Cockatoo Island iron ore project reported a 4.5 per cent increase to 617,619t processed.

Portman managing director Barry Eldridge said, in a media release, that the 2004 profit reflected the underlying strength of the company’s core iron ore operations at Koolyanobbing at a time of record global demand for iron ore which saw benchmark prices rise by 18.6 per cent last year.

"At Koolyanobbing, we moved quickly to develop the Northern Tenements at Windarling and Mt Jackson last year and integrated those areas into our existing Koolyanobbing operations, which is reflected in the increased level of production and sales for the year," he said.