CHINESE-backed miner MMG has urged European Union regulators to approve its $500m purchase of Anglo American’s Brazilian nickel assets, despite concerns the deal would hand Beijing greater influence over a material used in Europe’s steel industry, said the Financial Times in a recent report.
Troy Hey, MMG’s executive GM of corporate relations, said he expected the European Commission’s competition directorate to judge the deal on data rather than geopolitics. The commission is set to issue a formal warning over the transaction this week, said the newspaper citing people familiar with the matter.
Regulators are concerned the deal could reduce ferronickel supplies to European stainless steel makers, raising costs and hurting their competitiveness.
Christophe Moulin, a nickel analyst at Benchmark Mineral Intelligence, said the deal was “highly political” for producers that depend on imported ferronickel. MMG said independent data showed no ability or incentive to restrict the market.
The case comes as Brussels tries to cut its reliance on China for metals and minerals after Beijing curbed exports of several materials. Steel body Eurofer said any decision must protect Europe’s ability to source materials responsibly and prevent one country from dominating supply.
Turkish investor Robert Yildirim, whose CoreX Holding is a rival ferronickel supplier and had also bid for the Brazilian assets, said Chinese ownership was squeezing competitors out of the market. “The Chinese are controlling everything,” he said, adding he remained interested in an alternative deal that would reduce Europe’s dependence on China.
