Tech giants come knocking for a piece of Anglo American as copper scarcity bites Wanblad tells FT
Wanblad says "deep expressions of interest" from tech companies have yet to turn into a stake, while Beijing holds the key to the $54 billion Teck merger.
Anglo American is in discussions with technology firms regarding potential equity investments in the mining company as they seek to secure supplies of essential metals for data centers, according to chief executive Duncan Wanblad. The tech sector is exploring the possibility of either locking in long-term off-take agreements or acquiring an equity stake to ensure future copper supply, as copper scarcity continues to be a pressing issue.
Despite no stakes having been taken, Wanblad acknowledged deep expressions of interest from technology companies in securing copper supplies. Comex copper for December delivery has declined steadily, trading near $6.52 a pound, following stronger-than-expected US inflation data that has delayed a Federal Reserve rate hike. Copper prices on the London Metal Exchange (LME) settled at a record $14,822 on Monday, with the most-active contract remaining within 6% of its September 9 record settlement of $6.89.
Anglo American's shares on the New York Stock Exchange (NYSE) rose 0.6% to $26.86 on Thursday, valuing the company at $58.0 billion, while Teck Resources increased by 0.3% to $64.96, with a valuation of $31.9 billion. The combined market value of both companies would reach nearly $90 billion, surpassing the $53 billion initially announced for a merger of equals in September.
The proposed merger, expected to close by March 2027, would create a company with annual output of approximately 1.2 million tonnes, ranking among the top five copper producers globally. Chinese regulators are currently reviewing the merger, requiring Anglo to guarantee a steady flow of copper concentrate to Chinese smelters, including volumes traded through intermediaries, to obtain final clearance.
Meanwhile, Anglo American is also considering shutting down its nickel business in Brazil if the European Union does not approve the planned $500 million sale of assets to China's MMG, as the European Commission has launched an in-depth investigation into the deal.
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