Glencore has emerged as a crucial powerbroker in Anglo American’s $50 billion merger with Teck Resources because one of the transaction’s most valuable benefits cannot be delivered without the Swiss commodity group’s cooperation.
Anglo wants to integrate Teck’s Quebrada Blanca copper operation in Chile with the neighbouring Collahuasi mine.
The two operations are close enough to share processing plants, water, infrastructure and other facilities. Anglo chief executive Duncan Wanblad estimates that integration could eventually add approximately $1.4 billion in annual earnings.
However, Anglo owns only 44% of Collahuasi. Glencore controls an equal 44% interest, while a group of Japanese investors owns the balance.
The Financial Times reported that Anglo expects Glencore to negotiate aggressively over the value, management and ownership of an integrated operation.
