Anglo shoots back in war with Codelco

MINER Anglo American yesterday reaffirmed its refusal to sell any shares in its Chilean unit Anglo American Sur to state-owned copper miner Codelco.

Anglo American received a letter from Codelco earlier this week seeking to exercise an option to take a 49 per cent stake in AA Sur.

But Anglo claims Codelco is in breach of contract and has no right to exercise the option.

The UK-listed miner said: “Given that Codelco has breached the contract, Codelco has no right to exercise the option with respect to Anglo American and, as a result, any attempt to exercise the option can have no effect.” Codelco has already said Anglo’s actions have “no basis in law or in fact”.

It filed a legal complaint against Codelco for breach of contract seeking the termination of the option agreement and damages.

As a result of Codelco’s alleged breach of the contract, it is no longer entitled to enforce the option on Anglo American. The company alleges the breach consists of Codelco’s illegitimate premature attempt to exercise the option and Codelco’s actions aimed at preventing Anglo from exercising its contractual rights.

Codelco, the world’s biggest copper miner by production, said its rights extended to 49 per cent of shares in Anglo American Sur, which also includes a smelter and exploration properties.

Gerardo Jofré, the company president, told a news conference: “We have a right to 49 per cent or the equivalent value. We have right and the law on our side”.

In November, Anglo defensively sold 24.5 per cent of Sur to Mitsubishi, the Japanese industrial group, for $5.4bn. Anglo claims a residual 24.5 per cent stake is all that remains up for grabs.