Private equity firm in talks to buy Argor-Heraeus refinery – sources

Nov 2, 2016 - 12:34 PM GMT
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(Adds background and comments from Commerzbank, Austrian Mint and Heraeus)

London 02/11/2016 – A private equity firm is believed to be in talks to purchase the Argor-Heraeus gold refinery in Switzerland, sources have told Metal Bulletin.

Argor-Heraeus is part-owned by Heraeus, Commerzbank, the Austrian Mint and its management. The Austrian Mint and Commerzbank hold the largest stakes, according to their respective 2015 annual reports.

While it is not yet known how close the sale of Argor-Heraeus is to completion, the purchase price or whether the private equity firm is acting on behalf of other parties, Metal Bulletin understands that two other parties were also previously in the running for the refinery, both of which were other refining companies.

The Argor refinery, which has been in operation since 1951, is one of the largest in the world and one of only five refineries in Switzerland to be accredited by the London Bullion Market Association (LBMA) for good delivery.

According to its 2014 corporate responsibility report, it has refining capacity of 350-400 tonnes per year of gold. The refinery also produces platinum, palladium and silver, all of which are also accepted for good delivery.

In 1973, 100% of its shares were sold to Swiss banking giant UBS. In 1986, UBS and Heraeus Group formed a joint venture, creating Argor-Heraeus SA.

In 1999, Heraeus and management acquired 100% of the company, bringing Commerzbank on board, and, three years later Münze Österreich, the Austrian mint, also took a stake.

In 2004, Argor-Heraeus opened a representative office in Chile; it also has an office in Italy. It is not known whether the rumoured sale includes other areas of the business. 

Heraeus told Metal Bulletin that it will not comment on market rumours. Commerzbank and The Austrian Mint also declined to comment.

Should the sale go through, it will be the responsibility of the refining company on the Good Delivery list to inform the LBMA of the change of ownership as per the rules of the association.

“If a company on the List is subject to a substantive change in its ownership or the technology used in refining, it must inform the LBMA accordingly. The LBMA reserves the right in such circumstances to ask the company to submit a new application,” the rules state.

Swiss refiners have been the subject of international interest for the past few years. Last year, Indian jewellery giant Rajesh Exports agreed to purchase the world’s largest refinery, Valcambi, for $400 million. Earlier this year, Japan’s Tanaka Holdings agreed to purchase Metalor, another of the world’s largest refiners, for an undisclosed fee.

(Editing by Mark Shaw)