The British mining company Anglo American will acquire the Canadian Teck, and the merger between them will give rise to a new copper giant, to be called Anglo Teck. This company will include major Chilean deposits, such as Los Bronces, El Soldado, a significant stake in Collahuasi, Quebrada Blanca, among others.
By Ignacia Munita
The British miner Anglo American will acquire Canada’s Teck, and the merger between the two will create a new copper giant: Anglo Teck, a company valued at over US$50 billion in market capitalization, with Chile as a key axis of its global strategy.
The resulting company will have more than half of its production in Chile, considering that Anglo operates the Los Bronces and El Soldado mines and the Chagres smelter, in addition to holding 44% of Collahuasi and Carmen de Andacollo. “The union of both companies gives rise to a new giant in the sector, climbing positions in the Top 10 of the world’s largest copper producers,” highlighted in a conversation with The Clinic, Martín Muñoz, minerals market
analyst at Plusmining.
Muñoz also pointed out that, according to both companies, combined attributable production will reach 899,000 tons of copper annually, in addition to a diversified portfolio including premium iron ore, zinc, integrated smelters, and manganese assets.
He also emphasized that “in Chile, the Collahuasi–Quebrada Blanca district ranks among the richest in copper reserves worldwide. While previously both operations functioned independently, now the focus could be on taking advantage of their synergies.”
The potential of the Collahuasi–Quebrada Blanca district
According to the analyst, the announcement places special emphasis on the synergies between Collahuasi and Quebrada Blanca, due to their geographical proximity. In this regard, he commented that “one of the most notable initiatives is the possibility, in the future, of processing ore from Collahuasi at the Quebrada Blanca plant, which could increase annual production by 175,000 tons of copper.”
On this point, he said that the approach reflects a “trend in mining toward generating value through the coordination of nearby assets, in order to face growing challenges.” A notable example of this model is the coordination between Andina and Los Bronces.
Regarding the opportunity that opens up for Chile with the union of Anglo and Teck, Muñoz stated that “this merger is strategically and industrially coherent, with high value-creation potential. The Collahuasi–Quebrada Blanca district is shaping up as the true crown jewel.”
“The merger is expected to capture US$800 million annually before taxes in recurring synergies, reaching about 80% by the second year and fully maturing by the fourth year. In addition, through the integration of Collahuasi–Quebrada Blanca, they expect to generate an additional US$1.4 billion in annual EBITDA (100% basis) between 2030 and 2049,” he noted.
However, he warned that this situation “clearly does not come without costs,” since “to capture the recurring synergies, costs of US$700 million are expected to be distributed over the first three years. Furthermore, for the full integration of the district and its operational synergies, an additional US$1.9 billion is expected over the first four years following the completion of the transaction.”
Source: The Clinic