Anglo American Sur dispute continues

Finance

Publishing Date: 03 Jan 2012 11:37am GMT
Author: Mining Journal

The ongoing dispute between Anglo American plc and Chile's Codelco has continued at full steam into the new year, after the state-owned copper producer said it would proceed with an attempt to acquire 49% of Chile-based Anglo American Sur (AAS) from Anglo.

In a letter to Anglo on January 2, Codelco reaffirmed its intention to exercise a contractual option over 49% of AAS shares, an option which is only exercisable every three years during the month of January. Codelco revealed its plans in October 2011, after arranging US$6.75 billion in bridging finance through the diversified Japanese trader Mitsui & Co.

In November 2011, Anglo announced the sale of a 24.5% stake in AAS to Mitsubishi Corp, and has argued that as a result Codelco would be able to purchase only a 24.5% interest in AAS. Codelco responded by obtaining an injunction preventing the sale of any further shares in AAS.

Anglo launched its own legal action on December 22 when the company filed a writ for breach of contract by Codelco, contending that Codelco was no longer entitled to exercise its options over AAS. The dispute remains unresolved.