China's MMG confirms in talks to acquire Glencore mine in Peru

March 19, 2014 - 2:19:21 pm

HONG KONG: MMG Ltd, the overseas arm of Chinese state-owned Minmetals, confirmed Wednesday it was in talks with mining giant Glencore Xstrata to buy its Las Bambas copper mine project in Peru.

But Australia-based MMG admitted there was no guarantee a deal could be agreed.

The company is part of a consortium bidding for the project which includes Hong Kong-registered Guoxin International Investment Corporation and China's CITIC Metal.

If successful, it is estimated the acquisition would cost more than $5 billion and would be China's biggest mine deal, according to media reports.

In a statement to the Hong Kong Stock Exchange, MMG said discussions were taking place with Glencore International AG -- a subsidiary of Glencore Xstrata -- about the acquisition of the mine.

"No binding agreement has been reached in connection with the acquisition. There is no assurance that a binding agreement will be reached by MMG in connection with the acquisition or the acquisition will materialise," the statement added.

Swiss commodities trader Glencore secured Chinese backing for its May 2013 merger with mining giant Xstrata by agreeing to sell its interest in the Las Bambas copper mine project by the end of this September.

Chinese approval for the merger was the last one needed after the European Commission and South Afrian competition authorities gave the deal the green light.

The Las Bambas copper mines are not yet operational but it is estimated they will produce more than 400,000 tonnes of copper a year.

China is the world's biggest importer of the metal. (AFP)