Brazilian regulators have cleared BHP鈥檚 (ASX: BHP) intended acquisition of Australian copper-gold producer OZ Minerals (ASX: OZL) for A$9.6 billion ($6.6bn), bringing the world鈥檚 no.1 miner closer to securing its biggest deal in more than a decade.
OZ Minerals has a number of operations in Brazil, including the Santa L煤cia iron oxide copper-gold mineral deposit, the Antas copper-gold mine, and CentroGold, one of the country鈥檚 largest undeveloped gold projects.
The transaction, unanimously backed by OZ Minerals鈥� board in November, still requires the approval of Australia鈥檚 regulatory bodies and the copper-gold miner shareholders.
If successful, the deal would become聽the largest mining deal in Australia聽since BHP鈥檚 $12.1 billion purchase of Petrohawk Energy in 2011 and it would consolidate the company鈥檚 position as one of the world鈥檚 largest producers of copper.
The metal is considered key for the world鈥檚 clean energy transition, which is expected to boost demand by almost 60% over the next two decades.
Since BHP first announced its intention of buying OZ Minerals in August last year, copper prices have shot up 20%, from $3.55 per pound up to $4.27. This has led some shareholders to indicate they will vote against the existing deal.
鈥淭he reality of the situation is that the BHP offer now looks a little anaemic,鈥� David Franklyn of Argonaut Funds Management聽聽on January 30.
In his opinion, the Australian miner has one of the best exposures to the global copper market and sees 鈥渘o reason to sell out cheaply to BHP.鈥�
OZ Minerals shareholders will vote in early April on the A$28.25-a-share bid, which represents a 49% premium increase on the miner鈥檚 share price prior to BHP鈥檚 initial offer.
(With files from Reuters and Bloomberg)