Chinalco Mining Is Set to Appoint Bankers for Peru Copper-Mine Bid
Chinese Aluminum Giant's Listed Copper Unit Might Need to Tap Banks for Financing
By PRUDENCE HOAnd YVONNE LEEHONG KONG—Chinalco Mining Corp. International 3668.HK +0.85%of China is close to appointing investment banks Goldman Sachs Group Inc. GS -0.06%and Morgan Stanley MS +0.42%to advise it on buying the Peruvian copper mine owned by commodities company Glencore Xstrata GLNCY +2.84%PLC, in a deal that could be worth about $5 billion, people with knowledge of the deal said.
Glencore had agreed to sell Las Bambas as a condition of getting Chinese regulatory approval for its multibillion-dollar merger in April with Xstrata. The buyer will have to be approved by China's Ministry of Commerce. The conditions were imposed even though Glencore doesn't operate any copper-mining or processing facilities in China.
Chinalco Mining, the listed copper unit of Aluminum Corp. of China, 601600.SH -0.91%China's largest aluminum and alumina producer, is planning to appoint Goldman and Morgan Stanley soon, one of the people said Thursday.
Glencore, based in Baar, Switzerland, has said it hired BMO Capital Markets Ltd. and Credit Suisse Group AG CS +1.75%to act as financial advisers. It has also said the mine will cost $5.2 billion to develop and that it is scheduled to produce 400,000 metric tons of copper annually from 2015.
Goldman Sachs and Morgan Stanley declined to comment.
Glencore said the sale price should be the fair value of the project as determined by two independent investment banks it selected, or cover all the project costs incurred before a deal is agreed upon. The parties must agree to a sale by the end of the third quarter of 2014 and must close by the end of the first half of 2015 to meet China's conditions.
If Glencore fails to enter a binding agreement on the project sale or transfer the asset in time, it said it would then have to execute a rapid sale of one of four other copper projects: Tampakan in the Philippines, Alumbrera or El Pachon in Argentina, or Frieda River in Papua New Guinea.
The people with knowledge of the deal said Chinalco Mining, which had a debt-to-equity ratio of 77% at the end of June, might need to tap banks for financing should it decide to go ahead with a bid.
Chinalco, the state-owned parent of Chinalco Mining, has been trying to diversify outside the glutted aluminum sector.
It already has a substantial presence in Peru, where it operates the Toromocho copper mine in the center of the country. Toromocho is expected to start producing copper in the fourth quarter of 2013 and reach full production capacity in the third quarter of 2014, according to the company's annual report.
Energy-deficient China consumes more than 30% of global copper production, and its efforts to build up overseas reserves mirror its foreign acquisitions of oil and natural gas.
Wall Street Journal - HERE
- Forums
- ASX - By Stock
- LCL
- bring on monday
bring on monday, page-8
-
- There are more pages in this discussion • 6 more messages in this thread...
You’re viewing a single post only. To view the entire thread just sign in or Join Now (FREE)
Featured News
Add LCL (ASX) to my watchlist
|
|||||
Last
0.9¢ |
Change
0.000(0.00%) |
Mkt cap ! $8.683M |
Open | High | Low | Value | Volume |
0.9¢ | 0.9¢ | 0.9¢ | $16.74K | 1.860M |
Buyers (Bids)
No. | Vol. | Price($) |
---|---|---|
5 | 1682971 | 0.8¢ |
Sellers (Offers)
Price($) | Vol. | No. |
---|---|---|
0.9¢ | 356022 | 2 |
View Market Depth
No. | Vol. | Price($) |
---|---|---|
5 | 1682971 | 0.008 |
8 | 7567560 | 0.007 |
8 | 5530000 | 0.006 |
9 | 4341080 | 0.005 |
5 | 5878763 | 0.004 |
Price($) | Vol. | No. |
---|---|---|
0.009 | 356022 | 2 |
0.010 | 4681762 | 6 |
0.011 | 1459999 | 3 |
0.012 | 737500 | 2 |
0.013 | 83333 | 1 |
Last trade - 16.10pm 03/09/2024 (20 minute delay) ? |
Featured News
LCL (ASX) Chart |