Chile to Anglo: Sell if you want but we will get our stake

Reuters reports the Chairman of Chile’s Codelco vowed on Thursday to go ahead with buying a 49% stake in Anglo American’s southern Chilean properties. The state copper giant said that it would take all steps to ensure its option is respected and that it did not mind if Anglo cedes a part of its own stake to others.

Anglo American on Wednesday sold a 24.5% stake in the properties that includes the newly expanded $2.8 billion Los Bronces mine to Japan’s Mitsubishi Corp. for $5.39 billion, undermining plans by Chile’s state-owned Codelco to exercise an option to buy half of it. Chile decided at the end of October to exercise the 33-year old option that has lapsed before, blindsiding Anglo. Anglo said the transaction values its Chile properties at $22 billion. Codelco was offering $6 billion for 50%.

Chile’s finance minister warned Anglo at the time that it must honour the deal that dates back to 1978. Codelco has put together $6 billion but analyst say that short changes Anglo by billions. What must have really galled Anglo is that they would have had to pay around $1 billion in taxes on the transaction.