The deal, one of China’s biggest mining acquisitions in recent years, follows months of tortuous negotiations over how much the copper project is worth. In a short statement Sunday evening, Glencore said it had agreed to sell its entire interest in Las Bambas to a consortium led by MMG Ltd. , a unit of state-controlled China Minmetals Corp.
The transaction is expected to close by the autumn, subject to regulatory approval and a vote by MMG’s shareholders, Glencore said.China Minmetals, MMG’s 74% majority investor, has already “irrevocably” backed the deal, Glencore said.“Today’s announcement demonstrates our commitment to maximizing value for our shareholders,” said Glencore Chief Executive Ivan Glasenberg.
“This is a transformational acquisition for MMG,” MMG Chief Executive Andrew Michelmore said. “Our investment in this project of national importance is the first step in what we see as a long-term relationship with Peru,” he said.MMG expects the deal will be completed in the third quarter of this year.
The acquisition “is not cheap,” said Helen Lau, a senior analyst with UOB Kay Hian in Hong Kong. “The market expected it to be between $5 billion and $6 billion, and this is pretty much at the high end,” she said, adding that the mine “could still be profitable.