Anglo and Codelco restart talks to end dispute
The frantic legal battle between diversified miner Anglo American (LON:ALL) and its Chilean adversary Codelco, the world’s largest copper producer, was put on hold as the parties announced they were entering into talks.
In a press release, Anglo said the parties have agreed to explore the possibility of negotiating an agreement in relation to Anglo American Sur, as part of the Chilean court’s conciliation proceeding.
The miners, which were due to meet in court in Santiago on Tuesday, asked instead for a month-long suspension of the court dispute, opening a window for talks that will last until June 22.
Local newspaper El Mercurio reports Anglo American CEO, Cynthia Carroll, said the company had been “consistently in favour of discussing a commercial solution that takes into account the interests of both parties.”
Diego Hernández, Codelco’s chief executive, said the company would “explore again whether we can find points of agreement with Anglo American”, adding that talks about a negotiated settlement would be confidential.
Gerardo Jofré, president of Codelco’s board of director, added the company “has always been open to reaching an agreement if it is appropriate for the interests of the company and its owners, which are all Chileans. This has always been our sole motivation in all the decisions we make. "
The clash between Anglo American and Codelco goes back to November last year, when the copper giant decided to exercise an option and Anglo American responded by selling a 24.5% stake in its southern Chilean division to Japan’s Mitsubishi Corp. for $5.39 billion. By doing this, Anglo undermined plans by Codelco to exercise its option, something that copper miner would only have been able to do in January.
A failed attempt by Codelco to force Mitsubishi to hand over the particulars of the deal in December drove the Chilean company back to the courts by formally informing Anglo American that it was “exercising its legal option” to buy the contested 49% in Anglo Sur.
Last April, Codelco filed a petition to freeze 49% of the dividends paid by the Sur Division of the London-based miner, which was rejected.
If an agreement is not possible, then Chilean courts will have to settle the conflict, British ambassador to Chile, Jon Benjamin, said. He added that England has constantly stated that it is not its intention to make a political issue out of this unfortunate situation.
"We have been also clear on stating that, despite the current controversy between both companies, Chile remains an attractive country to do businesses and invest," Benjamin said.
Anglo American is one of Chile’s largest foreign investors.