BHP has moved on from its failed bid for Anglo American and found another way to get its hands on more South American copper, by linking up with a Canadian miner.
BHP and Canada’s Lundin Mining have agreed to jointly acquire 100 per cent of Filo Corp — another Toronto Stock Exchange-listed company — which owns the Filo del Sol copper project in Argentina.
BHP and Lundin have also agreed to form a 50/50 joint venture to hold Filo del Sol and the Josemaria copper development in the Chile. Lundin Mining owned a 100 per cent stake in Josemaria.
BHP told investors the total cash payment for the proposed transaction is expected to be about $US2.1 billion ($3.2b).
The duo will be paying a premium for Filo of 32.2 per cent based on its 30-day volume weighted average price. The Filo board has urged shareholders to back the takeover offer.
BHP took a 5 per cent stake in Filo del Sol back in 2022 for $US80m as a toe-hold investment to deepen its understanding of the Vicuña copper district.
BHP chief executive Mike Henry said the latest transaction aligns with the company’s strategy to acquire “attractive early-stage copper projects” and enter into strategic partnerships to develop them.
“The joint venture with Lundin Mining will advance the development of the Vicuña district, which offers the potential to become a major contributor to the economy of Argentina for decades to come,” he said.
Anglo American in May rebuffed multiple BHP’s buyout attempts, which had ultimately culminated in a $74 billion offer.
BHP was eager to get its hands on Anglo’s prized South American copper mines to tack on to its own substantial copper presence in Chile, including the Escondida mine — which is the largest copper producer in the world.
BHP’s appetite for big deals has returned last year after acquiring fellow ASX-listed copper producer OZ Minerals for about $9.6b.
Copper is a key input for the semiconducting components in the hardware that enables data centres and artificial intelligence technologies.
Shares in BHP were down 1.3 per cent in early trade to $41.51, in line with falls from its iron ore peers.