The Proposed $23 billion acquisition of Teck Resources Ltd. by Glencore Plc It is part of a copper consolidation trend that will lead to more deals as investors demand growth in an industry struggling to tap new deposits, according to the world’s top listed producer.
More offers likelyFreeport-McMoRan Inc. CEO Richard Adkerson said in an interview Tuesday. Shareholders once focused on returns are now putting pressure on companies to expand production as the shift away from fossil fuels increases demand and new mines become more complicated and expensive to build, he said.
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“He copper is a scarce commodity And when opportunities to grow in the copper business arise, for whatever reason, we will see companies move to take advantage of them,” he said. The recent deals are “indications of what is likely to be part of the landscape for our industry going forward.”
Freeport, which strengthened its balance sheet following an ill-fated foray into the oil business a decade ago, is watching deals but is focused on its own projects, Adkerson said.
In the near term, copper demand remains strong, Adkerson said, “we are increasingly optimistic regarding the longer-term outlook.”
RM
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