MMG Limited (MMG, the Company) has entered into a Share Purchase Agreement with Anglo American plc (Anglo American) for their nickel business in Brazil (Nickel Brazil) for an aggregate cash consideration of up to US$500 million, comprised of upfront cash consideration of US$350 million and up to US$150 million in contingent consideration.
Nickel Brazil is a world class and stable operation producing ~40 ktpa of nickel in ferronickel across two operating assets, Barro Alto and Codemin (Niquelândia). The transaction aligns with MMG’s growth strategy to expand its earnings, geographical footprint and base metal commodity exposure, marking the first investment into Brazil and the addition of an operating primary nickel mine to MMG’s portfolio.
Key Highlights
- Entry into Brazil, a Tier-1 mineral-rich and mining friendly jurisdiction;
- Strong operating earnings and free cash flow at low point in the nickel price cycle;
- Low-cost position (1st quartile on 2024 cash cost curve)*, with a long remaining mine life;
- Third-largest nickel endowment globally, with 5.2Mt contained nickel in resources, and growth optionality through Jacaré and Morro Sem Boné (MSB) – providing exposure to Class 1 (battery grade) nickel; and
- One of the largest ferronickel producers in the world with leading ESG credentials, using electricity sourced from 100% renewable energy.
Transaction Summary
In consideration of the transaction, MMG has agreed to pay Anglo American an aggregate cash consideration of up to US$500 million, comprising:
- Upfront cash consideration of US$350 million;
- Contingent cash consideration of up to US$100 million linked to the realised nickel price (Contingent Realised Nickel Consideration)**;
- Contingent cash consideration of up to US$50 million linked to a final investment decision at development projects, Jacaré and MSB (Contingent Development Consideration)***
“This acquisition is a great example of our growth strategy in action, as we expand our geographical footprint and diversify MMG’s metals portfolio. Already a strong performing business, there is considerable upside given its stable operational track record” said MMG’s Chairman Mr Jiqing Xu.
“We are excited to reach agreement to acquire Anglo American’s nickel business, which provides important diversification for our business and strengthens our presence in Latin America. It’s a strong business with a talented team, growth potential and demonstrated excellence in sustainability performance and we look forward to continuing this positive legacy. MMG and Anglo American have a long track record of close collaboration and shared values demonstrated through our commitment to ICMM principles. We look forward to working together towards completion,” said Mr Liang Cao, MMG’s CEO.
MMG has a portfolio focused on metals leveraged to a low carbon future – with sustainability at its core. Most recently MMG acquired Khoemacau, a high-quality operating mine, located in one of the most prospective mining regions in Africa, the Kalahari Copper Belt, in Botswana. MMG’s operations delivered robust production performance in 2024, including significant production milestones. Annual Results will be released on 4 March 2025.
In connection with the transaction, BMO Capital Markets acted as financial adviser, and White & Case and Lefosse acted as legal advisers to MMG.
Note: the Transaction is subject to a number of conditions, including customary competition and regulatory clearances. The upfront cash consideration is subject to normal completion adjustments and completion is expected by Q3 2025.
Media enquiries
Felicity Watson
0408 108 516
felicity.watson@mmg.com
About MMG
Founded in 2009, MMG’s vision is to create a leading international mining company for a low carbon future. The company is headquartered in Melbourne, Australia and Beijing, China and listed on the Hong Kong Stock Exchange (HKEX1208). MMG’s portfolio supports copper, zinc and cobalt production – products that are critical to achieving global decarbonisation and electrification targets. With operations in Australia, Botswana, the Democratic Republic of Congo and Peru. More info here.
About Anglo American
Anglo American is a leading global mining company focused on the responsible production of copper, premium iron ore and crop nutrients – future-enabling products that are essential for decarbonising the global economy, improving living standards, and food security. A portfolio of world-class operations and outstanding resource endowments offers value-accretive growth potential across all three businesses, positioning Anglo American to deliver into structurally attractive major demand growth trends. More info here.
Nickel
About two-thirds of all refined nickel produced is used by the stainless-steel industry. Stainless steel typically contains eight to 10 per cent nickel and is a critical input for construction. Nickel also contributes to the production of other metal alloys, rechargeable batteries, catalysis reactions, coin minting, metal coatings and casting.
* Based on Nickel Brazil’s H1 2024 actual C1 cash costs (as reported by Anglo American).
** The payment will be calculated as 50% of incremental, post tax revenue from nickel sales above the agreed realised nickel price of US$7.10/lb contained nickel, i.e. after the typical discounts for ferronickel products has been applied to the benchmark price.
*** US$40 million upon the Group making a final investment decision on the full-scale development of the Jacaré greenfield development project and US$10 million upon the Group making a final investment decision on the full-scale development of the Morro Sem Boné greenfield development project.
Presenation