NV Umicore SA History
Rue du Marais
Telephone: (32) 2-227-71-11
Fax: (32) 2-227-79-00
Incorporated: 1906 as Union Minière du Haut Katanga
Sales: EUR 3.5 billion ($2.8 billion) (2001)
Stock Exchanges: Euronext Brussels
Ticker Symbol: UNIM
NAIC: 212231 Lead Ore and Zinc Ore Mining; 212234 Copper Ore and Nickel Ore Mining; 212222 Silver Ore Mining; 212291 Uranium-Radium-Vanadium Ore Mining; 331492 Secondary Smelting, Refining, and Alloying of Nonferrous Metal (Except Copper and Aluminum); 331419 Primary Smelting and Refining of Nonferrous Metal (Except Copper and Aluminum); 331411 Primary Smelting and Refining of Copper; 331423 Secondary Smelting, Refining, and Alloying of Copper
Umicore's mission: Creating Material Value. Our business: Metals and Materials. We develop, produce, market and recycle metals-related materials and products, building on our competence in metallurgy and materials science. We seek out those markets and applications where we can respond with differentiated products and services. Our Goal: Leadership and Growth. We focus on business areas where we can attain recognized leadership positions that allow us to create value. We are committed to the growth of our business through the competence of our people, excellence in operations and technological innovation.
- Belgium government sets up the Union Minière du Haut Katanga (UMHK) to exploit mineral deposits in the soon-to-become Belgian Congo.
- UMHK begins casting copper, becoming a primary source of copper for Allied forces during World War I.
- UMHK branches out into tin production.
- UMHK begins gold and silver refining.
- UMHK adds production of radium.
- UMHK begins cobalt smelting operation.
- After the copper market collapses during the Depression, UMHK adds zinc mining and production.
- UMHK begins production of uranium.
- UMHK's Congo operations are nationalized by the Zaire government under the Mobutu dictatorship.
- UMHK becomes a subsidiary of Belgian conglomerate Société Génerale, which groups all of its smelting and mining interests under reformed Union Minière.
- Union Minière is now known as Acec-Union Minière after merging with three other Belgian companies.
- Company changes its name back to Union Minière.
- Union Minière undergoes far-reaching restructuring, selling off 12 divisions.
- Suez acquires Société Générale and announces its intention to spin off its holding in Union Minière.
- Union Minière becomes an independent, publicly listed company.
- The company changes its name to Umicore in order to break its link to former colonial mining activity and to emphasize its new focus as a modern specialty metals producer.
NV Umicore SA--known as Union Minière until late 2001--is one of the world's leading producers of zinc, precious metals, copper, and advanced materials. While its copper, zinc, and precious metals production units continue to represent the bulk of its revenues, the company has targeted Advanced Materials for growth, with a goal of doubling that division's revenues in 2002. Advanced Materials includes such metals and materials as germanium, selenium, and tellurium, used in applications such as semiconductors, electronics, optics, and other high-technology sectors. Part of the company's advanced materials production comes from a strong recycling division, which also recovers gold, platinum, and other precious metals. Umicore hopes that its name change will help the company shake its notoriety as Belgium's main mining operation in Africa--a market the company exited in the late 1960s. Umicore is listed on the Euronext Brussels stock exchange. Sales in 2001 topped EUR 3.5 billion ($2.8 billion).
Early 20th-Century Mining Giant
The Haut Katanga region of what later became known as the Belgian Congo (and subsequently Zaire, before being renamed Congo in the late 1990s) had long been recognized as a prime source of copper, zinc, and a variety of other metals and materials. In the later years of the 19th century, the Belgian government, propelled by King Leopold II, began laying the groundwork for the exploitation of the region's vast mineral deposits. Preliminary surveying was completed by 1901, and mining operations were begun a year later.
In 1906, Belgium's mining interests in the region were formalized with the creation of the Union Minière du Haut Katanga (UMHK), which was granted the right to exploit all of the region's copper deposits in an area that reached more than 20,000 square kilometers and included some of the world's richest copper deposits. UMHK also received permission to exploit the region's variety of minerals, which included silver, zinc, cobalt, cadmium, radium, uranium, germanium, and other precious minerals. Supporting its mining operations was the right to build dams and develop its own hydro-electric power systems. The company, backed by Société Generale, was placed under the leadership of Jean Jadot, who had helped build the railroad linking Peking (later Beijing) and Hankow (later Wuhan) in China, and Robert Williams, who had been one of the pioneering prospectors in the Katanga region. UMHK's position in the region was solidified when Belgium formally took control of what then became known as Belgian Congo.
UMHK originally mined and smelted copper ore in Katanga, shipping the smelted ores to Belgium to be refined. By the end of the decade, the company constructed refining facilities in Belgian Congo, and by 1911 began casting copper at Elisabethville, later renamed Lumbumbashi.
World War I and the German occupation of Belgium for the duration forced UMHK to move its headquarters to London. From there, the company contributed to the British and American war efforts, providing vital metals and minerals. By the end of the war, UMHK had shipped more than 85,000 tons of copper to the United States and England and other Allied countries.
Following the war, UMHK began branching out from copper production, adding tin production in 1918, gold and silver refining in 1921, radium in 1922, and then beginning cobalt smelting operations in 1924. During the Depression years, the company's core copper market collapsed. In response, UMHK added another important unit, that of zinc production, which began operations in 1937.
Cut off from its headquarters after the German invasion of Belgium during World War II, UMHK began shipping directly to the Allied countries, supplying more than 800,000 tons of copper throughout the duration of the war. UMHK began providing another important mineral, uranium, in 1942, production of which continued until the end of the 1950s.
UMHK's shipments to the Allies had enabled Belgium to emerge from the war more or less debt-free. The company remained one of the most important industrial concerns in Congo, yet by the end of the 1950s the company's days had become numbered in that country. This was particularly so after Congo won its independence in 1960. The chaos and violence that followed independence, temporarily abated by the arrival of U.N. peacekeeping forces, came to a head with the rise to power of Joseph Mobutu in 1965.
After ruthlessly consolidating his grip on the newly renamed Zaire, Mobutu moved to take control of the country's foreign-run industries. In 1966, UMHK was forced to move its headquarters to Kinshasha (formerly Leopoldville). By the beginning of 1968, however, the entirety of UMHK's mining and smelting operations in Zaire had been nationalized. The company then found itself without any business.
New Mining Concern for the 21st Century
During the 1970s, Union Minière (which dropped the Haut Katanga from its name) operated as a subsidiary of Belgian conglomerate Société Générale, grouping its nonferrous metals, mining, and smelting interests. In the late 1980s, however, Union Minière began to reassert itself as a full-fledged operation. In 1989, the company announced its intention to merge with three other Belgian companies, Metallurgie Hoboken-Overpelt, a producer of copper, lead, cobalt, germanium, and other precious and special metals; zinc producer Vieille Montagne; and Mechim, an engineering firm.
The newly enlarged company, which began operations under the Acec-Union Minière name, represented more than 200 years of Belgian metals and minerals production. The Vieille Montagne site had been producing zinc since before the French Revolution. The Hoboken-Overpelt company had been formed through the mergers of two companies, both of which had been active in metals and minerals production since the late 19th century.
The enlarged company restructured at the beginning of the 1990s, flattening out its management and organizational structure as it absorbed the different entities involved in the merger. By 1992, the company simplified its name, to Union Minière.
Yet Union Minière ran into difficulties in the early 1990s as the worldwide economic slump cut deeply into the company's profits. By 1995, the company was forced to undergo a drastic streamlining of its operations. Over the next four years Union Minière was to shed nearly a dozen of its business units in an effort to restore its profits.
Union Minière nonetheless remained committed to its position as a multi-metals producer, covering more than 20 metals categories, including its industry-leading positions in silver and platinum refining (number two in Europe), manufacturing of palladium and rhodium (Europe's largest), and positions as number two in the world's zinc refining market and number two in European zinc production. The company was also stepping up its involvement in specialty metals and the recycling of precious metals--primarily from used electronics parts. The company's multiple areas of activity left it somewhat on the sidelines during the consolidation spree of the late 1990s that saw mergers among many of its rivals.
Suez's takeover of Société Générale in 1998 temporarily gave Union Minière a new parent company. Yet Suez quickly made it clear that it intended to sell off its more than 25 percent holding in the Belgian metals giant. By the end of December 2000, Suez had exited Union Minière's shareholding, leaving the company as an independent, publicly listed company with no single major shareholder.
As it entered the new century, Union Minière had been making strides in transforming itself into a "modern" metals producer, placing growing emphasis on precious metals reclamation through recycling, while also stepping up its involvement in the specialty metals spheres, such as the production of cobalt and germanium alloys. An example of this came with the 1999 launch of a lithium cobalt oxide plant in South Korea. In 2000, the company attempted to step up its advanced minerals operations with the takeover of U.S.-based Laser Power, a fiber optics company; that takeover attempt failed, however.
Despite its new focus on advanced minerals and specialty metals, the company remained equally committed to its longstanding leadership positions in such base metals production as copper rods and zinc. These divisions continued to account for a
Nonetheless, in September 2001, Union Minière made a symbolic move to shed its longstanding image as a traditional metals producer by adopting a new name, Umicore. The name change also was meant to help the company divorce itself from Union Minière's controversial role in the development--some called it exploitation--of Belgian Congo.
With its new name, Umicore expected to continue its transformation in the early years of the new century. Among the company's plans was the doubling of its Advanced Materials division in 2002. The company was inaugurating a new germanium tetracholoride production plant in North Carolina, completed at the end of 2001. Another addition to its Advanced Materials division came in December 2001 when Umicore acquired Hall Chemical Company, based in the southeastern United States. That company, which produced specialty chemicals by converting nickel, cobalt, and manganese, was renamed Umicore Specialty Chemicals-Arab.
At the beginning of 2002, continued pressure on copper prices and oversupply of zinc once again called into question Umicore's long-term presence in these two sectors. Urging continued consolidation of these markets, Leysen stated to Reuters that Umicore intended "to be a catalyst rather than a bystander in this process." At the same time, however, Leysen suggested that Umicore had not yet determined if it intended to be a buyer or a seller in any future consolidation move.
Principal Competitors: Anglo American plc; ASARCO, Inc; Asturiana de Zinc, S.A.; BHP Billiton Limited; De Beers Consolidated Mines Limited; Falconbridge Limited; Impala Platinum Holdings Limited; Inco Limited; Johnson Matthey Public Limited Company; Metaleurop SA; Grupo México S.A. de C.V.; Mitsubishi Materials Corporation; Mitsui Mining & Smelting Co., Ltd.; Noranda Inc.; Norddeutsche Affinerie AG; Outokumpu Oyj; Phelps Dodge Corporation; Rio Tinto Limited; Sumitomo Metal Mining Co., Ltd.; Teck Cominco Limited; Toho Zinc Co., Ltd.
- Crols, Bart, "Union Miniere in Acquisition Talks," Reuters, May 16, 2001.
- Michiels, Karel, "De historische fouten van Umicore," De Standaard, September 19, 2001.
- Nguyen, Katie, "Umicore Sees Lower 2001 EPS, No Upturn Until 2003," Reuters, November 12, 2001.
- Reynolds, Vicki, "Union Miniere Strategy Working Well," American Metals Market, January 17, 2001.
- "Umicore Eyes Copper Sector Consolidation," Reuters, February 15, 2002.
- Warden, Edward, "Umicore Won't Abandon Base Metals," American Metals Market, September 13, 2001.
Source: International Directory of Company Histories, Vol. 47. St. James Press, 2002.