Freeport-mcmoran Completes Phelps Dodge TakeoverPublished by MAC on 2007-03-19
Freeport-McMoRan completes Phelps Dodge takeover
19th March 2007
New Orleans-based Freeport-McMoRan Copper & Gold (NYSE: FCX) has completed its US$26bn acquisition of Phoenix-based miner Phelps Dodge (NYSE: PD), Freeport said in a statement Monday.The merger has created the world's largest publicly traded copper-producing company, displacing Grupo México (BMV: GMEXICOB).
Under the terms of the transaction, Phelps shareholders received US$88 in cash and 0.67 of a Freeport share for a total value of US$129/share based on the price of Freeport common stock on March 16. The cash portion of the deal adds up to US$18bn, according to the statement.
Richard C Adkerson and James R Moffett are to stay on as CEO and chairman respectively, Freeport said.
Phelps Dodge president and COO Timothy R Snider will become the COO of the merged company, while Phelps CEO Steven Whisler and CFO Ramiro Peru are to step down.
After the close of the merger Freeport launched a public offering for 35mn common shares and 10mn preferred shares at US$100/share to aid in repaying the expense of the acquisition, according to a separate Freeport statement.
Phelps' South American copper operations include its 53.6% owned Cerro Verde mine in Peru, as well as its 80% owned Candelaria/Ojos del Salado mine and 51% owned El Abra mine, both in Chile.
Freeport owns the giant Grasberg copper-gold mine in Indonesia and also copper operations in Spain.
Chilean state-owned Codelco has the rest of El Abra while Japan's Sumitomo holds minority stakes in Candelaria and Cerro Verde, in the latter case along with Peru's Buenaventura (NYSE: BVN).