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Lundin Mining to cool heels on acquisitions, not eyeing Anglo copper assets

Published 01/12/2014, 23:43
© Reuters. An aerial view of Anglo American's Los Bronces copper mine at Los Andes Mountain range, near Santiago city
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By Nicole Mordant

(Reuters) - Lundin Mining Corp (TO:LUN), which has spent over $2 billion on acquisitions in 18 months, is done with purchases for now and is not interested in acquiring Chilean copper assets from Anglo American (L:AAL), Lundin's chief executive said on Monday.

Paul Conibear, CEO of the Canadian base metals miner, which has been on a buying spree at a time when weak metal prices have depressed mining M&A, said the company would cool its heels for some time as it folds in its recent purchases.

Although Lundin has been tracking Anglo's moves for the past few years expecting new CEO Mark Cutifani to sell some assets, it is not after the Chilean mines that sources say the global miner has put up for sale.

Lundin, along with commodities group Glencore (L:GLEN) and X2, a company set up by former Xstrata boss Mick Davis, have been named by sources as potential suitors for Anglo's Mantos Blancos and Mantoverde mines, the Chagres smelter and its 50.1 percent stake in the El Soldado mine.

"If those assets are formally for sale ... we have no intention to be in that process," Conibear said in an interview from Lundin's head office in Toronto.

"We have lots on our plate right now. Don't expect anything of any size or materiality out of us for probably the next couple of years," he said.

In October, Lundin, a mid-sized copper, zinc and nickel miner with a market value of $3.5 billion, said it would buy 80 percent of the Candelaria copper mine in Chile from Freeport-McMoran Inc (N:FCX) for $1.8 billion.

That followed its purchase of the Eagle copper mine in Michigan for $325 million in June 2013.

Unlike some of its peers, Lundin did not make acquisitions in the mining boom of 2010-12, when soaring metals prices propelled asset prices only to collapse soon after, forcing companies to take writedowns.

Lundin's stock price is up 25 percent in the past year compared with a 6.4 percent slide in the S&P/TSX Mining Index (GSPTTMN).

© Reuters. An aerial view of Anglo American's Los Bronces copper mine at Los Andes Mountain range, near Santiago city

In 2015, Lundin, which also has mines in Europe and Africa, plans to spend half of its exploration budget at the Candelaria project alone as the company believes it has "outstanding" potential and underutilized infrastructure, Conibear said.

(Reporting by Nicole Mordant in Vancouver, editing by G Crosse)

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