British government urges Anglo American and Codelco to reach amicable resolution

Chile's state-owned mining company Codelco, the world's largest copper producer London-based Anglo American (LSE: AAL) should try reaching a negotiated solution to the ongoing dispute about Codelco’s stake in Anglo’s Sur unit, said British ambassador to Chile, Jon Benjamin.

"Our vision is and has always been that this is a controversy between two companies and not a conflict at which governments must be involved," said Benjamin during his remarks at CRU's 11th World Copper Conference, held in Santiago, reports Terra Colombia.com

The conflict between the companies goes back to November last year, when Codelco 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.

If an agreement is not possible, then Chilean courts will have to settle the conflict, said Benjamin, who 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 added.

Codelco's CEO Diego Hernández responded to the ambassador by saying that his company has been unable to reach an agreement with Anglo American and that is why they are in court right now, “as is expected to happen in a civilized country," as quoted by Terra Colombia.com.