Mitsubishi Upends Codelco’s Anglo Sur Ambitions

Anglo American has agreed to sell 24.5% of the Anglo Sur copper mining complex in Chile to Mitsubishi in a surprise $5.39bn deal. The move lands a blow to Chilean state copper company Codelco’s ambitions to secure a 49% stake in the venture. Mitsubishi swooped in on the chance to pay $5.39bn for only 24.5%, or a multiple of 18.1x 2010 Ebitda. Mitsubishi’s implied enterprise valuation for the entire project was $22.9bn. Codelco can now only buy a smaller, 24.5% piece. “The valuation is compelling,” an Anglo American spokesman says when asked to comment on the sale, which comes just ahead of the government’s option exercise date. Goldman Sachs and UBS advised Anglo American on the deal, according to company officials. Codelco sought to exercise an option in January 2012 to buy 49% of Anglo Sur paying an estimated $6bn, or 10.2x 2010 Ebitda. The option made this possible as long as Anglo American held 100% of the venture at the time, Anglo American officials said. Codelco officials could not be reached for comment, but in a statement the company said the transaction “doesn’t affect Codelco’s rights over 49% of the shares in Anglo Sur” and that it would “pursue all necessary actions” to defend its rights. Mitsubishi has been a long-time investor in Chilean copper and currently holds a 2.5% stake in Chile’s Escondida open pit mine.