THE £53bn planned merger between Anglo American and Teck Resources announced on Tuesday could trigger a wave of consolidation amongst mining rivals, analysts told Reuters.
“Both BHP and Rio would like more copper if they could get it, although they may blink at the prices now,” said Ian Woodley, fund manager at Old Mutual, which holds shares in mining companies including Anglo.
The sector’s second-biggest ever tie-up would create the world’s fifth-largest copper company and appears to have broad support. Anglo shares rose 9%, whilst Teck stock climbed 14% following the announcement, said Reuters.
Industry watchers believe rivals Glencore, BHP, and Rio Tinto – which have seen their own M&A attempts fail – could now move to gain scale in copper, a metal critical for electric vehicles and data centres.
“It is certainly not impossible that others may try to interlope,” George Cheveley, portfolio manager at Ninety One, a top 20 Anglo shareholder, told the newswire “At least this could spark further consolidation as companies look to establish larger positions, particularly in the copper market.”
Last year, Anglo rejected a £39bn takeover bid from BHP, whilst in 2023, Teck turned down a $22.5bn offer from Glencore. Early-stage talks between Rio Tinto and Glencore also collapsed late last year.
“Anglo and Teck have made the first move, but the contest for control of these copper assets may not be over,” said Tony White, analyst with MKP Advisors.
The deal, expected to complete within 12-18 months, would see Anglo’s investors receive a £4.5bn special dividend.
