TIDMGLEN
RNS Number : 7303E
Glencore Xstrata PLC
14 April 2014
Baar, Switzerland
Sale of Las Bambas Copper Mine Project
14 April, 2014
Glencore Xstrata plc ("Glencore") has signed an agreement for
the sale of its entire interest in the Las Bambas copper mine
project ("Las Bambas") to a consortium owned 62.5% by MMG Limited,
22.5% by GUOXIN International Investment Corporation Limited and
15.0% by CITIC Metal Co., Limited (the "Consortium").
The consideration for the transaction is approximately US$5.85
billion, payable to Glencore in cash on closing. In addition, all
capital expenditure and other costs incurred in developing Las
Bambas in the period from 1 January 2014 to closing will also be
payable by the Consortium. At the end of March 2014, capital
expenditure and other costs incurred since the start of the year
amounted to approximately US$400 million.
The proceeds from the sale will immediately and materially
de-gear Glencore's balance sheet. Glencore will continue to look
for opportunities to reinvest capital in line with our published
returns criteria. Any surplus capital, subject to maintaining an
efficient balance sheet within Glencore's strong BBB/Baa credit
ratings guidance, will be returned to shareholders, within an
appropriate time frame and structure.
The transaction is subject to certain regulatory approvals
(including MOFCOM) as well as the approval of MMG Limited
shareholders. China Minmetals Non-Ferrous Metals Company Limited,
which holds approximately 74% of the share capital of MMG Limited,
has irrevocably committed to vote in favour of the transaction. The
transaction is expected to close prior to the end of Q3 2014 and is
being conducted pursuant to the Remedy Commitments entered into
with MOFCOM at the time of Glencore's merger with Xstrata.
Commenting on today's announcement, Ivan Glasenberg, CEO of
Glencore said:
"Today's announcement demonstrates our commitment to maximising
value for our shareholders. Since we acquired Xstrata on 2(nd) May
2013, our team has taken decisive steps to de-risk Las Bambas,
which has culminated in this compelling offer from the Consortium.
Our willingness to sell reflects the level of the offer and our
conviction that we can utilise the sale proceeds to create
additional shareholder value."
BMO Capital Markets Limited ("BMO Capital Markets") and Credit
Suisse Securities (Europe) Limited ("Credit Suisse") are acting as
financial advisors to Glencore in connection with the sale.
For further information, please contact:
Charles Watenphul Paul Smith
(Media) (Investors)
t: +41 (0) 41 t:+41 (0)41
709 2462 709 2487
m: +41 (0) 79 m: +41 (0)79
904 33 20 charles.watenphul@glencore.com 947 1348
paul.smith@glencore.com
About Glencore Xstrata
Glencore Xstrata is one of the world's largest global
diversified natural resource companies. As a leading integrated
producer and marketer of commodities with a well-balanced portfolio
of diverse industrial assets, we are strongly positioned to capture
value at every stage of the supply chain, from sourcing materials
deep underground to delivering products to an international
customer base.
The Group's industrial and marketing activities are supported by
a global network of more than 90 offices located in over 50
countries. The Group's diversified operations comprise over 150
mining and metallurgical sites, offshore oil production assets,
farms and agricultural facilities. We employ approximately 190,000
people, including contractors.
About Las Bambas
Las Bambas is a long-life copper development project with
prospective exploration options. Located in Cotabambas, Apurimac
Region of Peru, the project is at an advanced stage of construction
and is scheduled to commence production in 2015.
As at 31 December 2013, Las Bambas had gross assets of US$4,420
million. Given that the project is still in a pre-production phase,
Las Bambas' total profit for the financial year ended 31 December
2013 was US$(0.02) million.
Forward looking statements
This document contains statements that are, or may be deemed to
be, "forward looking statements" which are prospective in nature.
These forward looking statements may be identified by the use of
forward looking terminology, or the negative thereof such as
"plans", "expects" or "does not expect", "is expected",
"continues", "assumes", "is subject to", "budget", "scheduled",
"estimates", "aims", "forecasts", "risks", "intends", "positioned",
"predicts", "anticipates" or "does not anticipate", or "believes",
or variations of such words or comparable terminology and phrases
or statements that certain actions, events or results "may",
"could", "should", "shall", "would", "might" or "will" be taken,
occur or be achieved. Such statements are qualified in their
entirety by the inherent risks and uncertainties surrounding future
expectations. Forward-looking statements are not based on
historical facts, but rather on current predictions, expectations,
beliefs, opinions, plans, objectives, goals, intentions and
projections about future events, results of operations, prospects,
financial condition and discussions of strategy.
By their nature, forward looking statements involve known and
unknown risks and uncertainties, many of which are beyond Glencore
Xstrata's control. Forward looking statements are not guarantees of
future performance and may and often do differ materially from
actual results. Important factors that could cause these
uncertainties include, but are not limited to, those discussed on
pages 18 to 31 of Glencore Xstrata's Annual Report 2013.
Neither Glencore Xstrata nor any of its associates or directors,
officers or advisers, provides any representation, assurance or
guarantee that the occurrence of the events expressed or implied in
any forward-looking statements in this document will actually
occur. You are cautioned not to place undue reliance on these
forward-looking statements which only speak as of the date of this
document. Other than in accordance with its legal or regulatory
obligations (including under the UK Listing Rules and the
Disclosure and Transparency Rules of the Financial Conduct
Authority and the Rules Governing the Listing of Securities on the
Stock Exchange of Hong Kong Limited and the Listing Requirements of
the Johannesburg Stock Exchange Limited), Glencore Xstrata is not
under any obligation and Glencore Xstrata and its affiliates
expressly disclaim any intention, obligation or undertaking to
update or revise any forward looking statements, whether as a
result of new information, future events or otherwise. This
document shall not, under any circumstances, create any implication
that there has been no change in the business or affairs of
Glencore Xstrata since the date of this document or that the
information contained herein is correct as at any time subsequent
to its date.
Disclaimer
BMO Capital Markets, which is authorised and regulated by the
Financial Conduct Authority in the United Kingdom, and Credit
Suisse, which is authorised and regulated by the Financial Conduct
Authority and the Prudential Regulation Authority in the United
Kingdom, are acting for Glencore Xstrata plc and for no one else in
connection with the sale process and will not be responsible to any
person other than Glencore Xstrata plc for providing the
protections afforded to clients of BMO Capital Markets or Credit
Suisse, nor for providing advice in relation to the sale process,
the content of this announcement or any matter referred to herein.
Neither BMO Capital Markets, Credit Suisse nor any of their
respective subsidiaries, branches or affiliates owes or accepts any
duty, liability or responsibility whatsoever (whether direct or
indirect, whether in contract, in tort, under statute or otherwise)
to any person who is not a client of BMO Capital Markets or Credit
Suisse in connection with this announcement, any statement
contained herein or otherwise.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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