Glencore takes over Congolese copper mine
COMMODITIES giant Glencore yesterday announced that it had taken control of the Mutanda copper operation in Congo for $480m (£304.4m).
Glencore had a stake in the company but is now in the driving seat.
The move marks the first step in a planned merger of the mine with its nearby Kansuki concession.
Mutanda, in central Africa’s copper belt, is one of Glencore’s main growth assets and a key operation in the Democratic Republic of Congo alongside its Katanga operation, largely thanks to its high ore grades and low expansion costs.
The company said it had paid $340m in cash to acquire both a further 24.49 per cent in Samref Overseas, the top holding company above Mutanda, taking its hold in the controlling entity to almost 75 per cent, and a further one per cent in Samref Congo, a second holding company.
Glencore, hoping to accelerate development of the copper operations with yesterday’s move, has also acquired shareholder debts amounting to around $140m.
The deals take its indirect equity interest in Mutanda Mining to 60 per cent.
Meanwhile miner Xstrata, which is the subject a bid by Glencore, raised its copper production target.
The FTSE 100 company said sluggish copper demand in China will pick up in the second half as it makes plans to boost production of the metal by 60 per cent.
Charlie Sartain, Xstrata’s copper division head, added that demand in Europe remains flat, but America is starting to show signs of returning appetite.