Wuhan Wraps MMX M&A

China’s Wuhan Iron and Steel has concluded its acquisition of a 21.5% stake in Brazil miner MMX for $400m. MMX will issue 167.8m units at $3.93 each, of which Wuhan will be entitled to 102m shares. In June, Wuhan had proposed acquiring a 9.09% stake in MMX for $120m through the purchase of new shares. Terms of the original deal also would have allowed Wuhan to acquire a 23% stake in MMX subsidiary MMX Sudeste, but this did not happen. Itau analysts believe the deal reduces immediate refinancing needs for MMX, could accelerate capex for the expansion of MMX’s mines while guaranteeing a captive buyer for 50% of MMX’s future iron ore production through a 20-year contract. The agreement also likely increases MMX’s share liquidity, adds the shop. Credit Suisse advised MMX while BNP Paribas helped Wuhan.