On April 14 (Beijing time), MMG Limited (hereinafter referred to as “MMG”, HKEx: 1208) under China Minmetals Corporation (hereinafter referred to as “China Minmetals”) announced that a consortium comprised of MMG, GUOXIN International Investment Corporation Limited (hereinafter referred to as “GUOXIN International”) and CITIC METAL CO., LTD. (hereinafter referred to as “CITIC METAL”) signed an equity acquisition agreement on Las Bambas copper mine project (hereinafter referred to as “Bambas Project”) with Glencore Xstrata plc, with the consideration for the transaction of USD5.85 billion (about HKD45.63 billion).

Bambas Project marks the largest overseas acquisition ever in Chinese metal mining industry.

Bambas Project is a vital copper mine asset involved in the transaction of merger between Glencore plc and Xstrata plc. Located in Apurimac in southern Peru, this project is the world’s largest copper mine project under construction. It is expected to produce about 450,000 tons of copper in copper concentrate each year in the first 5 years after it is put into production. After acquisition and completion of Bambas Project, it is hopeful that China Minmetals will become China’s biggest copper mine production enterprise and one of global top 10 copper mine producers.

President Zhou Zhongshu of China Minmetals said, “Bambas Project totally accords with the long-term strategy of China Minmetals and MMG, and will contribute to improving the portfolio of mining assets of China Minmetals and will offer good strategic synergies to the company’s existing business.” As to subsequent operation of Bambas Project, he said that China Minmetals will cooperate with various parties such as partners, project team, local community, governments at all levels of Peru and relevant institutions in building and operating Bambas Project well with MMG as the core by adhering to the philosophy of “cherishing limited resources and pursue boundless development” and sticking to the international strategy of “global vision, local operation, Chinese and Western cooperation and win-win”.

The transaction is subject to approval by Peruvian government, Chinese government and MMG Shareholder Meeting. If everything goes well, the transaction will be completed in the third quarter of this year. The acquisition will be completed jointly by MMG, GUOXIN International and CITIC METAL, which hold 62.5%, 22.5% and 15% of shares in the consortium respectively. The bank consortium led by China Development Bank and joined by ICBC and BOC provide fund support for this acquisition.

For this acquisition, Citibank and Bank of America Merrill Lynch are financial consultants of Minmetals consortium, White & Case LLP, Dentons and REM are legal consultants, and ICBC International and BOC International are financing consultants; Deutsche Bank is the financial consultant of Minmetals.