Mitsui extends loan period for Codelco's potential purchase of Anglo Sur
TOKYO (Reuters) - Japan's Mitsui & Co (8031.T) has agreed to extend by one month a loan commitment to Codelco CODEL.UL to fund the possible purchase of a stake in Anglo American Plc's (AAL.L) Chilean copper properties, which are the subject of a legal dispute, a source familiar with the deal said.
The agreement keeps Mitsui, Japan's second-biggest trading house, in a strong position to take a small stake in Anglo's prized Anglo American Sur (AAS) copper asset in south-central Chile once a bitter row between Anglo America and Codelco, which also involves Japan's top two trading houses, is settled.
Mitsui earlier committed to providing a loan of up to $6.75 billion until August 1 and has extended the period to Sept 1, while reducing the amount to $5.8 billion, the industry source, who declined to be identified because the deal is confidential, told Reuters.
Anglo and Chile's state-owned Codelco have been at odds since last October over Codelco's option to buy a 49 percent stake in AAS.
Codelco said in October it would exercise the option to buy the AAS stake when a window opened in January of this year, and secured funding from Mitsui.
But weeks later, Anglo surprised the market and Codelco with a pre-emptive sale of a 24.5 percent stake in AAS to Japan's biggest trading house, Mitsubishi Corp (8058.T), in a $5.4 billion deal. That stake was taken from the original 49 percent in the option that Codelco had intended to exercise.
Under the original loan agreement with Codelco, Mitsui had an option to indirectly own up to 24.5 percent of AAS, with Codelco owning the remaining 24.5 percent.
The dispute between Anglo and Codelco has been dragging on and the two parties last month agreed to extend talks until August 24.
One of the options under negotiation calls for Mitsubishi to cede part of its 24.5 percent stake in AAS, making room for Codelco to buy a larger stake in the asset, sources familiar with the talks have said. Mitsui in turn could take the portion ceded by Mitsubishi, via a joint venture with Codelco, in return for providing funding to the Chilean company, they said.
Chilean newspaper La Tercera reported last month that Mitsubishi could cede 5 percent of its 24.5 percent stake in the asset.
(Editing by Edmund Klamann)
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