Powerscourt aids mining group after FTI resignation

LONDON: A global mining venture at the heart of a $10bn (£6.21bn) international dispute has drafted in agency help after former incumbent FTI Consulting resigned the account.

LONDON: A global mining venture at the heart of a $10bn (£6.21bn) international dispute has drafted in agency help after former incumbent FTI Consulting resigned the account.

Onyx Financial Advisors called in Powerscourt to fight the corner of Israeli billionaire Beny Steinmetz's mining group over a clash with the newly elected government of Guinea.

The dispute centers on key mining exploration licences held in the West African country by Beny Steinmetz Group Resources via a joint venture with Brazilian mining firm Vale.

The group acquired the iron ore mining rights in 2006 and sold on just over half its share to Vale for $2.5 billion (£1.55 billion) in 2010 – the entire venture is estimated to be worth between $8-10 billion.

But the recently installed government of Guinea is reviewing pre-existing mining agreements and has pledged to take back the licences after making allegations of corruption against Steinmetz's group.

Last month, Beny Steinmetz Group Resources denied the accusations, stating "the allegations are baseless and merely constitute a crude smear campaign" and the group "contests the legitimacy of the whole process and will use all available means to protect the rights it legally acquired in Guinea."

The statement was issued via FTI Consulting, which was contracted by Onyx, a company that provides management and administration services to Steinmetz's group.

However, FTI resigned the account in mid-November over conflict issues. PRWeek UK understands this conflict stemmed from FTI Consulting's chairman of global affairs, Lord Malloch-Brown, and his relationship with international financier George Soros.

Malloch-Brown, former UN Deputy Secretary-General and foreign office minister, is involved with a number of Soros' foundations, which include Global Witness and Open Society Foundations.

Soros is understood to have become involved in the campaign against Steinmetz's group's involvement in Guinea and it is thought FTI's conflict related to Malloch-Brown's close relationship with Soros.

PRWeek UK has learned that Powerscourt was called in without a pitch in the days following FTI's resignation on the recommendation of one of Steinmetz group's legal advisers.

It is understood Powerscourt's brief encompasses all four Steinmetz-owned businesses, including real estate and diamonds, and will focus on the group's positioning in international media as well as proactively fighting the corruption allegations.

The account is thought to be worth a significant six-figure sum.

A version of this article originally appeared on the website of PRWeek UK, the sister publication of PRWeek at Haymarket Media.

Would you like to post a comment?

Please Sign in or register.

News by email...