Anglo American sells Chile stake direct to Mitsubishi

Anglo American plc has announced the sale of a 24.5% stake in its Anglo Sur (AAS) copper business in Chile to Mitsubishi Corp for US$5.39 billion. In October, Mitsui & Co agreed to buy the equivalent stake from Codelco for US$4.9 billion, once the state-owned miner had exercised an option (which falls due in January 2012) to buy 49% of Anglo Sur. This week’s transaction values 100% of the business at US$22 billion, compared with the discounted value of US$13.7 billion (and possibly lower), at which Codelco could have exercised its option.The Anglo-Mitsubishi transaction is unconditional, and the US$5.39 billion has already been paid via a promissory note from the Japanese trading company.

The company said: “Anglo American has regularly reviewed its available alternatives and, following a thorough assessment, and in the interests of its shareholders, it entered into a process to explore the potential value of the AAS assets through the evaluation of a sale of a minority stake in AAS.”

Codelco has responded, claiming the deal does not affect its rights over a 49% interest in Anglo Sur.

Anglo American says the transaction is fully compliant with the option agreement. However, it has not been made clear whether the deal would change the price Codelco would need to pay for its stake.

The option is exercisable only during the month of January every three years until January 2027.