Falconbridge Nickel Mines

Falconbridge Limited

Company type	Public
Industry	Mining
Founded	1928
Founder	Thayer Lindsley
Defunct	2007
Fate	Acquired by Xstrata and rebranded as Xstrata Canada Corporation
Headquarters	Toronto , Canada
Area served	18 countries worldwide
Key people	Aaron Regent (CEO at time of acquisition)
Products	Nickel, copper, cobalt, platinum, zinc, lead, aluminium products, precious metals recycling
Parent	Xstrata (from 2006)

Falconbridge Nickel Mines Limited, which adopted the name Falconbridge Limited in 1982, was a Canadian mining enterprise active from 1928 until 2007. The company maintained operations across 18 nations, concentrating on the exploration, extraction, processing, and commercialization of metals such as nickel, copper, cobalt, and platinum. It was publicly traded on both the Toronto Stock Exchange (TSX: FAL.LV) and the New York Stock Exchange (NYSE: FAL), reporting revenues of US$6.9 billion in 2005. In August 2006, Falconbridge was acquired by Swiss-based mining giant Xstrata, a major shareholder at the time. Subsequently, on 28 October 2007, Falconbridge Limited was rebranded as Xstrata Canada Corporation.

The company derived its name from the Ontario town of Falconbridge, which itself honors Sir William Glenholme Falconbridge, a distinguished High Court Judge whose family originally emigrated from Ireland.

Falconbridge significantly contributed to the economic growth of northern Ontario, especially in the region surrounding Greater Sudbury.

History

In 1928, prospector and entrepreneur Thayer Lindsley secured nickel-copper ore claims located northeast of Sudbury. These deposits had initially been discovered by Thomas Edison in 1901 but remained undeveloped until Lindsley's acquisition. To support mining activities, a company town named Falconbridge was established. The enterprise adopted the name Falconbridge Nickel Mines Limited.

The following year, in 1929, Falconbridge broadened its operations by purchasing the Kristiansand refinery in Norway, thereby obtaining rights to the Hybinette nickel refining technique. By 1930, underground mining operations were yielding approximately 250 tonnes daily alongside an operational smelter; a milling and sintering plant commenced operations in 1932.

During the 1950s and 1960s, the Sudbury Basin experienced substantial expansion with twelve additional mines extracting nickel, copper, and platinides. In 1952, cobalt extraction began at the Nikkelverk refinery through newly developed processes. The acquisition of Ventures Limited in 1962 enhanced Falconbridge’s international presence and exploration capabilities.

Falconbridge Dominicana (Falcondo) initiated production in Bonao, Dominican Republic, in 1971 utilizing advanced reduction and smelting technologies. The Falcondo Foundation was founded in 1989 to promote community development and corporate social responsibility programs.

In 1977, Falconbridge secured a patent for an innovative chlorine leach process for nickel refining.

In the late 1970s, Falconbridge partnered with Inco on environmental reclamation projects around Sudbury, inaugurating a more efficient smelter and sulfuric acid plant that minimized emissions while generating additional revenue streams.

By 1984, reserves at the original Falconbridge Mine were exhausted; however, production persisted at other Sudbury locations. The company expanded its footprint within northern Ontario through acquisition of the Kidd Mine and associated metallurgical facilities in Timmins. Growth continued throughout the 1990s with new mining developments in Sudbury as well as the Raglan Mine in northern Quebec. Despite these successes, Falconbridge was unsuccessful in securing the Voisey's Bay deposit, which was awarded to Inco. In the early 2000s, further acquisitions included Montcalm mine (Timmins), Kabanga project (Tanzania), and Lomas Bayas mine (Chile).

In March 2005, Noranda proposed merging with Falconbridge. By June that year, Noranda—already holding a controlling interest of 58.4%—completed a full merger with Falconbridge Limited, thereby incorporating aluminum mining and electronic hardware recycling into its business portfolio.

In August 2005, Brascan Limited divested its 20% ownership stake in Falconbridge to Xstrata, strengthening Xstrata’s position prior to its full acquisition of the company in 2006.

Operations as of 2006

At the point of the Xstrata acquisition, Falconbridge controlled significant assets within the Sudbury Basin, including the underground copper and nickel mines of Craig, Fraser, and Thayer Lindsley. The company also operated the Strathcona mill, a nickel smelter, a sulfuric acid plant, and a technology centre. In 2005, Falconbridge initiated the Deposit Definition stage for the Nickel Rim South mine located near Sudbury Airport.

The refining of metals had transitioned from Sudbury to Falconbridge's Nikkelverk facility in Kristiansand.

Elsewhere in Canada, Falconbridge managed operations such as the Kidd Mine and the Kidd Metallurgical Site in Timmins, Ontario. These sites comprised an underground copper/zinc mine, a concentrator, copper smelting and refining plants, zinc processing facilities, indium and cadmium production units, as well as sulfuric acid plants. Additionally, the company operated the Montcalm underground nickel mine located west of Timmins. Other Canadian properties included facilities in Quebec and Ontario (Rouyn-Noranda: Horne copper smelter; Montreal: CCR copper refinery; Salaberry-de-Valleyfield: CEZ zinc refinery; Nunavik: Raglan underground nickel/copper mine and mill), along with operations in Bathurst, New Brunswick (Brunswick underground zinc/lead mine with associated lead smelting, lead refining, and silver refining).

Falconbridge maintained copper and precious metal recycling centers at various locations including Brampton, Ontario; East Providence, Rhode Island; La Vergne, Tennessee; Roseville, California; San Jose, California; and Penang, Malaysia.

In addition to base metals, Falconbridge operated an aluminium smelter in New Madrid, Missouri and an alumina refinery situated in Gramercy, Louisiana. The aluminium products were further processed at four rolling mills located in Huntingdon, Tennessee (two mills), Salisbury, North Carolina (one mill), and Newport, Arkansas (one mill).

In Central America and the Caribbean region, assets included the St. Ann bauxite mine near Discovery Bay, Jamaica and the Falcondo nickel surface mine with its processing plant in Bonao, Dominican Republic.

Falconbridge’s South American portfolio was concentrated on copper operations such as Peru's Antamina copper/zinc open-pit mine; Chile’s Collahuasi open-pit copper/molybdenum mine equipped with a mill, liquid–liquid extraction facility, and electrowinning plant; Lomas Bayas open-pit copper mine featuring liquid–liquid extraction and electrowinning plants; along with the Altonorte copper smelter also located in northern Chile.

The company owned a Boeing 737-200 aircraft (registration C-FFAL) based at Toronto Pearson International Airport. After the takeover by Xstrata, this plane was repainted with Xstrata branding and continues to be in service.

Merger efforts and acquisition

Back in 1996 during the competitive bidding between INCO and Falconbridge for the Voisey's Bay deposit, a strategic idea was proposed suggesting that Falconbridge withdraw its bid for this Labrador property to focus instead on acquiring INCO. This proposal was ultimately declined by Falconbridge’s principal shareholders Noranda and Brascan.

On 11 October 2005, Inco made a $12 billion offer to acquire Falconbridge amid elevated base metal prices. This move aimed to prevent foreign takeovers while leveraging operational synergies in Sudbury through Project Pentlandite. Both companies shared expertise in similar extraction and smelting techniques.

Soon after, hostile bids surfaced: Swiss firm Xstrata, which held a 19.9% stake in Falconbridge through Brascan shares, sought full ownership; meanwhile Vancouver-based Teck Cominco targeted Inco.

On 13 May 2006, Inco increased its bid for Falconbridge by CAD 5 per share to CAD 61.04. Then on 26 June 2006, Phelps Dodge proposed approximately US$40 billion for the combined Inco/Falconbridge entity with plans to establish the world’s fifth-largest mining company and a leading producer of nickel and copper headquartered in Phoenix and Toronto.

On 18 May 2006, Xstrata presented an offer of CAD 52.50 per share in cash for Falconbridge. This offer was raised to CAD 59 on 12 July—9.6% higher than Inco’s bid—valuing Falconbridge at roughly CAD 22.5 billion. Xstrata finalized its acquisition by late August 2006 and rebranded Falconbridge as Xstrata Nickel based out of Toronto. Consequently, Inco remained open to acquisition proposals from Phelps Dodge and Brazilian company CVRD.

By August 2007, Falconbridge was leading development of the Koniambo mine project with CEO Aaron Regent negotiating debt financing from both China Minmetals and the China Development Bank.

On 2 May 2013, Glencore completed its merger with Xstrata.

Social impact in Sudbury

The name Falconbridge was adopted by a company town situated northeast of Sudbury, officially established as the town of Falconbridge in 1957. This community later combined with others to form the Town of Nickel Centre and the Regional Municipality of Sudbury in 1973, which eventually became part of Greater Sudbury through amalgamation in 2001.

A portion of Falconbridge's workforce resided in the nearby area known as Happy Valley, which was deserted during the 1960s due to environmental contamination stemming from the Falconbridge smelter operations.

Referred to colloquially as "Falco," the company held the position of Sudbury’s second-largest employer for many years, trailing only behind its competitor Inco. The local economy was heavily reliant on these mining enterprises, with labor strikes at either company having profound effects on thousands of employees. However, this economic dependency diminished as Sudbury diversified its industries throughout the 1980s and 1990s.

Employees and their families formed strong bonds with these mining firms, which contributed to a well-known rivalry between the unions representing Falconbridge and Inco workers. During the 1950s and early 1960s, tensions between these unions occasionally escalated into street confrontations within Sudbury.

In 2006, a proposed merger between Inco and Falconbridge adopted the motto "Two proud histories, one great future," emphasizing the companies’ longstanding significance to the local community.

Falconbridge Road, one of Sudbury’s principal thoroughfares, serves as a tribute to the company’s legacy. Additionally, in 2007, Xstrata gifted Falconbridge’s historic Edison Building, formerly its headquarters, to Greater Sudbury for use as the municipal archives.

Presidents

1. Thayer Lindsley, 28 August 1928 – 3 March 1936
2. James Gordon Hardy, 3 March 1936 – 15 March 1945
3. Lewis K. Brindley, 15 March 1945 – July 1947
4. Thayer Lindsley, July 1947 – 28 March 1956
5. Robert Bernard Anderson, 28 March 1956 – 20 March 1957
6. Dr Horace John Fraser, 20 March 1957 – 2 February 1969 †
7. Marsh Alexander Cooper, 6 February 1969 – 2 June 1980
8. Douglas Broward Craig, 2 June 1980 – 21 October 1980
9. Harold Townsend Berry, 21 October 1980 – 31 December 1982
10. Dr William Fleming James, 20 April 1982 – 18 September 1989
11. Alexander George Balogh, 25 September 1989–31 December 1990
12. Franklin George Thomas Pickard, 1 January 1991 – 25 September 1996 †
13. Øyvind Hushovd, 9 December 1996 – 27 February 2002
14. Derek George Pannell, 27 February 2002 – 1 June 2002
15. Aaron William Regent, 1 June 2002 – 21 August 2006

Chairmen of the Board

1. Howard Brighton Keck, 1969–1978
2. Joseph Edmondson Reid, 1978–1981
3. Harold Townsend Berry, 14 September 1981 – 31 December 1982
4. Dr William Fleming James, 1 January 1983 –18 September 1989
5. Alexander George Balogh,1994 –23 April2003
6. David Wylie Kerr,23 April2003 –17 August2006

† = died while in office

External links

• Official website, preserved in the Xstrata archives
• Xstrata Nickel division site
• Documentation on Xstrata's acquisition of Falconbridge