MELBOURNE, July 21 (Reuters) - China’s MMG Ltd won unanimous approval from its shareholders on Monday to buy the Las Bambas copper project in Peru from Glencore Plc for $5.85 billion and sell more than half the output to MMG’s majority owner.
The sale to a consortium led by MMG is expected to be completed by September pending final consents, boosting MMG’s growth prospects and putting Glencore in a strong position to return capital to its shareholders.
Las Bambas, which is due to begin producing in 2015, is expected to produce 300,000 tonnes of copper a year over 20 years. Output is expected to be higher in the early years at more than 500,000 tonnes by 2016.
“We estimate Las Bambas would not only place MMG among the top 10 global copper producers (number one in Asia), it could also increase its net income multi-fold,” Barclays analyst Ephrem Ravi said in a note in June.
MMG declined to comment on Monday on what further approvals were needed for the deal. Its CEO, Andrew Michelmore, said last week that funding arrangements were in place and the company was “very close” to completing the acquisition.
MMG’s parent, state-owned China Minmetals Corp, abstained from the vote on selling 57 percent of the mine’s output to its subsidiary China Minmetals Non-ferrous Metals Company.
Reporting by Sonali Paul; Editing by Richard Pullin