Development: On 12 October the Chilean state-owned mining company, Corporación del Cobre (Codelco), announced that it intended to exercise its option to buy into Anglo American Sur (AAS).
Significance: The move was immediately applauded by the mining minister, Hernán de Solminihac. The deal will give Codelco up to 49% of Anglo American Sur, which owns key projects such as the Los Bronces and El Soldado copper mines, the Chagres smelter and the promising Los Sulfatos and San Enrique Monolito projects. The deal is Codelco’s biggest ever corporate move.
Key points:
• Codelco has made arrangements to secure US$6.75bn in financing for the deal from Mitsui, a Japanese conglomerate.
• The deal will reinforce Coldeco’s position as the world’s biggest producer of mined copper.
• In 2008 Codelco acquired the option from another Chilean state-owned mining company, Enami, to buy up to 49% of AAS. The option can only be exercised once every three years, in the month of January, and runs until 2027. January 2012 is the option’s next exercise date.
• As part of the financing agreement with Mitsui, Codelco can pay off part of the loan by selling half the shares in AAS to Mitsui.
• Mitsui itself has stakes in two other Chilean copper mines, Collahuasi and Pelambres.
