Southern Steel Berhad (SSB) and Bekaert have agreed to a joint venture, 45% owned by SSB and 55% owned by Bekaert. SSB is a leading Malaysian Steel Group, and Bekaert is a global leader in drawn steel wire products and advanced coatings. SSB will bring its interests in both Southern Wire Industries Malaysia Sdn Bhd (SWI) and Southern Specialty Wire Sdn Bhd (SSW) to the table, and Bekaert will bring its galvanized wire activity platform.
“Developing a partnership with Southern Steel will create a production and sales platform for our joint wire and ropes activities in South-East Asia that responds to our ambitions for growth in the region.”
— Henri-Jean Velge, Bekaert Group Executive Vice President Wire
The deal has an estimated value of approximately 63 million USD, and is expected to be completed by the third quarter of 2012. -Press Release from Bekaert. 5.09.12
Commodity metal costs are extremely high this spring, and Canada has taken a unique approach to cut back on expenses: on May 4 the Canadian Mint minted its very last penny. The 1 cent will of course continue to be accepted as regular currency, but store owners are being encouraged to start rounding their prices to the nearest 5 cent denomination, rather than nearest one cent. The Canadian government estimates that it will save about $11 million in production costs because of its decision to stop minting the 1 cent. Ironically enough, the U.S. had actually proposed eliminating the U.S. penny many years ago, back in 2011, but the bill never went through. Last year, the U.S. Mint produced almost 5 billion pennies, at a cost of 2.41 cents a piece. U.S. tax payers could have saved about $70 million by not having to pay for penny production this year.
The U.S. Commerce Department’s Economics and Statistics Administration has noted a rebound in manufacturing jobs. Since January 2010, manufacturing employment has increased by about 4% to 489,000 jobs. According to a recent study titled “The Benefits of Manufacturing Jobs,” the educational attainment of the manufacturing workforce is steadily rising: in 1994, 43% of manufacturing workers had at least some college education; in 2011 that number was 53%.
Metals update: While the price of scrap steel has remained largely unchanged in recent weeks, the market is seeing fewer buyers. Service centers are vying with each other to track down orders, often with little success, and several major mills have announced plans to raise their prices in order to stem the loss. –Metal Bulletin
JPMorgan Chase & Co’s hedging unit leader Ina Drew has announced her retirement, following trading losses that some experts estimate at more than $3 billion. Drew, one of the highest-paid execs at the bank, will be replaced by Matt Zames, once an employee at Long-Term Capital Management. According to bank execs, Drew’s retirement after 30 years at JPMorgan comes on the heels of a highly publicized mismanagement of a portfolio of derivatives tied to creditworthiness of bonds. Drew has been considered by many to be among the best managers of balance risk sheets, and may still be entitled to nearly $14.7 million in stock awards after resignation, if she meets full-career eligibility criteria. Shares of JPMorgan today were down 2.7% to $35.98, and the stock has lost 12%, or $18.12 billion, of its overall value since the mismanagement was disclosed.
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