For some specialists, the union of Anglo and Teck is the most significant in the last decade, yet there is still a long way to go before it materializes, recalling other failed acquisitions in the recent past. Juan Carlos Guajardo of Plusmining, Álvaro Merino of Núcleo Minero, and Patricio Faúndez of GEM Mining Consulting share their perspectives.
By Matías Vera
On Tuesday, mining giants Anglo American and Teck announced a merger that has shaken both the domestic and global mining industry. “A global champion of critical minerals” is what Anglo Teck aims to become, as the companies described their agreement. The merger will place the group among the world’s top five copper producers, after Codelco, BHP, Freeport, and Zijin.
“It is very good news,” said Plusmining’s executive director, Juan Carlos Guajardo, “in terms of the scale of the companies and the level of production. We are talking about a major milestone in mining industry mergers and acquisitions.”
Guajardo noted that “what we are seeing here is both companies responding proactively to what happened more than a year ago. It is a proactive response in terms of how these companies envision their role in the global commodities market.”
He referred to past merger attempts, such as BHP’s unsuccessful bid to acquire Anglo American in 2024 and Glencore’s failed attempt to take over Teck in 2023. In both cases, shareholders rejected hostile offers.
Why might this merger succeed now?
Guajardo explained: “Time always changes perspectives. Both companies, after facing acquisition attempts, have been developing reorganization plans. With time, these plans probably make such complex transactions more feasible.”
Looking at the future, he added: “Definitely, more mergers will come. For years we have anticipated that a reorganization of the industry would occur, given that there are very few high-quality projects available worldwide, and many others are far from production. Therefore, the fastest way to show growth potential and create shareholder value is through mergers and acquisitions. What BHP attempted, what Glencore attempted, this announcement, and others show that we are in an open process of M&A within the industry.”
For his part, Núcleo Minero’s executive director, Álvaro Merino, stated that the merger “is one of the most important in the last ten years.” However, he emphasized that “this is only the agreement reached so far, and there is still a long way to go. Authorities in China, Canada, and London must still rule on the deal.”
The former research manager of the Chilean National Mining Society (Sonami) added that “the key aspect of this operation is that it clearly demonstrates the strong appetite at present to secure copper production, anticipating the high demand expected in the future from electromobility and the development of clean energy.”
Merino also projected that “new actors could intervene in this operation with a superior offer. And we must keep a close eye on China, because China is taking clear and concrete steps to secure its long-term supply of minerals.”
The General Outlook on the Merger
Patricio Faúndez, head of economics at GEM Mining Consulting, provided a broad assessment of the Anglo Teck merger. “Collahuasi is currently the second-largest mine in Chile, with a production of 559,000 tonnes of copper in 2024, of which 246,000 belong to Anglo American according to its ownership stake. If combined with the production of the neighboring Quebrada Blanca (208,000 tonnes), the total reached 766,000 tonnes in 2024,” said Faúndez.
He explained that “with the integration of Anglo American and Teck, the new group would consolidate itself as a global-scale player, with annual production of around 1.2 to 1.3 million tonnes of copper and a market valuation comparable to Glencore’s.”
The analyst stressed that one of the keys to the merger lies in operational synergies. “The merger could generate an additional increase of approximately 175,000 tonnes of copper per year, which would translate into nearly US$1.4 billion in incremental annual EBITDA in the long term.”
However, Faúndez warned that the operation must still go through regulatory processes and obtain shareholder approval. “This cycle could last between 12 and 18 months, as both companies have stated,” he said.
The expert emphasized that BHP’s failed attempt to acquire Anglo in 2024 and the current merger highlight a clear trend. “Major mining companies will seek growth through mergers and acquisitions, driven by the value of synergies and the scarcity of new deposits. This points to an outlook of greater consolidation in the industry,” Faúndez remarked.
Meanwhile, Plusmining’s analyst Juan Carlos Guajardo suggested that “developing a combination, a merger project, involves years of study, investment, and construction. But it is also made easier when we are talking about existing operations, not greenfield projects. It is much more feasible to develop projects of this nature.”
Regarding the timeline for completing the merger, Guajardo concluded: “I would estimate close to five years in some cases, but here I think it could be faster. Since these are active operations, the project could be developed more quickly, making the timeline shorter.”
Source: La Tercera