SYS-CON MEDIA Authors: Yeshim Deniz, Elizabeth White, Greg Ness, Sean Houghton, Glenn Rossman

News Feed Item

MMG to acquire Las Bambas

HONG KONG, April 14, 2014 /PRNewswire/ -- MMG Limited (MMG) (HK.1208) today announced that, through a joint venture with a wholly owned subsidiary of Guoxin International Investment Corporation Limited, a financial investment company registered in Hong Kong (GXIIC), and CITIC Metal Co., Ltd. (CITIC), it has entered into a Share Purchase Agreement (SPA) with GlencoreXstrata to acquire the Las Bambas copper project in Peru for US$5.85 billion.[1]



Unique opportunity to acquire a world-class copper asset with prospective, near mine exploration opportunities


  • Large, long-life copper development project located in the Apurimac region of Peru
  • Advanced stage construction project, close to production
  • Set to become one of the largest global copper mines once in full production
  • 6.9 million tonne copper Ore Reserve, 10.5 million tonne copper Mineral Resource [2]
  • Expected to produce in excess of 2 million tonnes of copper in concentrate in its first five years of operation
  • Prospective, near mine exploration opportunities

Powerful consortium – led by MMG

  • MMG-led joint venture: MMG (62.5%, operator), GXIIC (22.5%) and CITIC (15.0%)
  • Leverages MMG's expertise as an operator of large, open-pit mines
  • Transaction supported by MMG's majority shareholder China Minmetals
  • Transaction and project capital cost fully funded using a combination of equity and long-term debt to be arranged through a Chinese banking syndicate

Transformational acquisition that delivers on MMG's growth strategy and vision

  • Creates long-term value for all our stakeholders
  • Supports MMG's positive long-term view of copper
  • Significantly increases attributable copper production and reserves
  • Establishes strong platform in highly prospective South American mining region



"This is a transformational acquisition for MMG," MMG Chief Executive Officer Mr Andrew Michelmore said.

"We are pleased to lead this joint venture and establish a strong platform in one of the world's most prospective mineral precincts. Our investment in this project of national importance is the first step in what we see as a long-term relationship with Peru."

"The addition of Las Bambas to MMG's international portfolio delivers on our growth strategy and vision – to build a global diversified minerals and metals company and create opportunities for all stakeholders – including our shareholders, employees and communities," he said.

"This acquisition is consistent with China Minmetals' vision for MMG as its international investment platform for base metals projects," Mr Michelmore said.

"MMG has the ability to add value to the asset through its operating strength, progressive leadership, commitment to world-class standards and unique partnership with its major shareholder."

Transaction details

The transaction consideration and the remaining project capital costs are to be fully funded using a combination of equity and long-term debt facilities from a banking syndicate to be arranged by China Development Bank (CDB).

The SPA is subject to customary regulatory approvals from the People's Republic of China and Peru, and the approval of MMG shareholders. A transaction circular together with a notice of an extraordinary general meeting to approve the transaction is expected to be dispatched to MMG's shareholders on or before 30 June 2014. MMG's majority shareholder, CMN, has irrevocably committed to vote in favour of the transaction.

"China Minmetals is proud to be supporting MMG in the development of this significant project," China Minmetals Corporation President Mr Zhou Zhongshu said.

"The acquisition of Las Bambas is an important milestone for outbound Chinese investment in the global resources industry and also for our partners GXIIC and CITIC," he said.

MMG anticipates that the transaction will be completed in the third quarter 2014.

Las Bambas

Las Bambas, located in Cotabambas, Apurimac Region, Peru is one of the world's largest copper projects under construction with a 10.5 million tonne copper Mineral Resource (0.62% Cu grade) and 6.9 million tonne copper Ore Reserve (0.73% Cu grade).[3] Las Bambas is expected to operate for over 20 years with upside potential from associated unexplored tenements.

"Las Bambas is expected to produce in excess of 2 million tonnes of copper in concentrate in its first five years of operation," Mr Michelmore said.

"We also believe there are opportunities to extend the existing resource and mine life as a significant proportion of the licence area is currently unexplored."

After an extensive due diligence process, MMG will provide an update on the project schedule and future capital expenditure requirements upon transaction completion.

The project has an excellent development team in place and we value their experiences and knowledge of the project," Mr Michelmore said.

"Our goal is to effect a smooth transition of ownership without a disruption to project development, and we look forward to working closely with the existing team to bring Las Bambas into production," he said.

The development of this world-class asset will deliver material benefits through the payment of taxes and royalties, training and employment, contract and supply opportunities and social investment over its operating life.

"Over the past two years of construction, Las Bambas has been an important contributor and employer to the local region and economy. We will seek to maintain and strengthen this relationship in the coming years," said Mr Michelmore.

The joint venture partners will assume responsibility for project capital expenditure from 1 January 2014.

MMG Limited

MMG is a leading international miner, listed on the Hong Kong Stock Exchange (HK.1208) with operations in Australia, Africa and Asia. As one of 21 members of the International Council on Mining and Metals (ICMM), MMG is committed to operating to world-class standards in safety, health, environment and community management.

MMG will host a teleconference at 9.30am Hong Kong time on Monday 14 April 2014. For further details please contact Investor Relations or Media Relations.

Lead joint financial advisers to MMG on behalf of the JV consortium are Citigroup and Bank of America Merrill Lynch supported by financing advisors BOCI Asia Limited and ICBC International Capital Limited. MMG's legal advisors are White & Case, Dentons and Rodrigo, Elias & Medrana. MMG's major shareholder China Minmetals Non-ferrous Metals Co. Ltd, was advised by Deutsche Bank.


Media Relations

Kathleen Kawecki
T +(61) 3 9288 0996 / (61) 400 481 868
[email protected]


Investor Relations

Colette Campbell
M +(61) 422 963 652
[email protected]


Peru

Bernardo Oliart
Apoyo Communications
T +(511) 205-3900 x. 945
[email protected]


Maggie Qin
M +(61) 411 465 468
[email protected]  

North America

Ian Hamilton
DFH Public Affairs
T +1-(416) 206-0118 x.222 / +1-(905) 399-6591
[email protected]    



China

Christine Chan
T +852 2801 6090 / M +852 6173 9039
E [email protected]   




[1] Including the payment of intragroup loans.

[2] GlencoreXstrata Reserves and Resources Statement as at 31 December 2013.

[3] GlencoreXstrata Reserves and Resources Statement as at 31 December 2013.




More Stories By PR Newswire

Copyright © 2007 PR Newswire. All rights reserved. Republication or redistribution of PRNewswire content is expressly prohibited without the prior written consent of PRNewswire. PRNewswire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

Latest Stories
"Matrix is an ambitious open standard and implementation that's set up to break down the fragmentation problems that exist in IP messaging and VoIP communication," explained John Woolf, Technical Evangelist at Matrix, in this SYS-CON.tv interview at @ThingsExpo, held Nov 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA.
The Internet of Things will put IT to its ultimate test by creating infinite new opportunities to digitize products and services, generate and analyze new data to improve customer satisfaction, and discover new ways to gain a competitive advantage across nearly every industry. In order to help corporate business units to capitalize on the rapidly evolving IoT opportunities, IT must stand up to a new set of challenges. In his session at @ThingsExpo, Jeff Kaplan, Managing Director of THINKstrateg...
The Internet of Things promises to transform businesses (and lives), but navigating the business and technical path to success can be difficult to understand. In his session at @ThingsExpo, Sean Lorenz, Technical Product Manager for Xively at LogMeIn, demonstrated how to approach creating broadly successful connected customer solutions using real world business transformation studies including New England BioLabs and more.
How do APIs and IoT relate? The answer is not as simple as merely adding an API on top of a dumb device, but rather about understanding the architectural patterns for implementing an IoT fabric. There are typically two or three trends: Exposing the device to a management framework Exposing that management framework to a business centric logic Exposing that business layer and data to end users. This last trend is the IoT stack, which involves a new shift in the separation of what stuff happe...
An entirely new security model is needed for the Internet of Things, or is it? Can we save some old and tested controls for this new and different environment? In his session at @ThingsExpo, New York's at the Javits Center, Davi Ottenheimer, EMC Senior Director of Trust, reviewed hands-on lessons with IoT devices and reveal a new risk balance you might not expect. Davi Ottenheimer, EMC Senior Director of Trust, has more than nineteen years' experience managing global security operations and asse...
DevOps is all about agility. However, you don't want to be on a high-speed bus to nowhere. The right DevOps approach controls velocity with a tight feedback loop that not only consists of operational data but also incorporates business context. With a business context in the decision making, the right business priorities are incorporated, which results in a higher value creation. In his session at DevOps Summit, Todd Rader, Solutions Architect at AppDynamics, discussed key monitoring techniques...
P2P RTC will impact the landscape of communications, shifting from traditional telephony style communications models to OTT (Over-The-Top) cloud assisted & PaaS (Platform as a Service) communication services. The P2P shift will impact many areas of our lives, from mobile communication, human interactive web services, RTC and telephony infrastructure, user federation, security and privacy implications, business costs, and scalability. In his session at @ThingsExpo, Robin Raymond, Chief Architect...
The 3rd International @ThingsExpo, co-located with the 16th International Cloud Expo - to be held June 9-11, 2015, at the Javits Center in New York City, NY - announces that it is now accepting Keynote Proposals. The Internet of Things (IoT) is the most profound change in personal and enterprise IT since the creation of the Worldwide Web more than 20 years ago. All major researchers estimate there will be tens of billions devices - computers, smartphones, tablets, and sensors - connected to th...
What do a firewall and a fortress have in common? They are no longer strong enough to protect the valuables housed inside. Like the walls of an old fortress, the cracks in the firewall are allowing the bad guys to slip in - unannounced and unnoticed. By the time these thieves get in, the damage is already done and the network is already compromised. Intellectual property is easily slipped out the back door leaving no trace of forced entry. If we want to reign in on these cybercriminals, it's hig...
The definition of IoT is not new, in fact it’s been around for over a decade. What has changed is the public's awareness that the technology we use on a daily basis has caught up on the vision of an always on, always connected world. If you look into the details of what comprises the IoT, you’ll see that it includes everything from cloud computing, Big Data analytics, “Things,” Web communication, applications, network, storage, etc. It is essentially including everything connected online from ha...
SYS-CON Media announced that Centrify, a provider of unified identity management across cloud, mobile and data center environments that delivers single sign-on (SSO) for users and a simplified identity infrastructure for IT, has launched an ad campaign on Cloud Computing Journal. The ads focus on security: how an organization can successfully control privilege for all of the organization’s identities to mitigate identity-related risk without slowing down the business, and how Centrify provides ...
The Internet of Things will greatly expand the opportunities for data collection and new business models driven off of that data. In her session at @ThingsExpo, Esmeralda Swartz, CMO of MetraTech, discussed how for this to be effective you not only need to have infrastructure and operational models capable of utilizing this new phenomenon, but increasingly service providers will need to convince a skeptical public to participate. Get ready to show them the money!
We are reaching the end of the beginning with WebRTC, and real systems using this technology have begun to appear. One challenge that faces every WebRTC deployment (in some form or another) is identity management. For example, if you have an existing service – possibly built on a variety of different PaaS/SaaS offerings – and you want to add real-time communications you are faced with a challenge relating to user management, authentication, authorization, and validation. Service providers will w...
The 3rd International Internet of @ThingsExpo, co-located with the 16th International Cloud Expo - to be held June 9-11, 2015, at the Javits Center in New York City, NY - announces that its Call for Papers is now open. The Internet of Things (IoT) is the biggest idea since the creation of the Worldwide Web more than 20 years ago.
In her General Session at 15th Cloud Expo, Anne Plese, Senior Consultant, Cloud Product Marketing, at Verizon Enterprise, focused on finding the right mix of renting vs. buying Oracle capacity to scale to meet business demands, and offer validated Oracle database TCO models for Oracle development and testing environments. Anne Plese is a marketing and technology enthusiast/realist with over 19+ years in high tech. At Verizon Enterprise, she focuses on driving growth for the Verizon Cloud platfo...