Grupo México Seeks to Acquire the Largest Mine in Spain

Grupo México and Canada's Hudbay Minerals Inc. are among the final bidders competing to acquire the Spanish copper mine Minas de Aguas Teñidas (Matsa) from Grupo Trafigura, which is the largest mine in Spain.

Both companies made binding offers between US$1.5 billion and US$2 billion. Hudbay is currently working with Ontario Teachers' Pension Plan, which would provide funds to acquire the mine, while Grupo México plans to buy the mine through its publicly traded mining unit Southern Copper. Rio Tinto Group, the world's second-largest miner, was also interested in the mine. However, the company will probably not purchase the mine. Currently, Grupo México is considered the strongest bidder, sources told Bloomberg.

Last week, Hubay shares rose 7.7 percent in US trading and closed 2 percent. Meanwhile, Southern Copper shares rose 2.6 percent, reaching the 0.4 percent rise in the MSCI World Metals & Mining Index. According to Bloomberg, a winning bidder has yet to be chosen.

Trafigura and Abu Dhabi Endowment Fund Mubadala Investment Co. have been looking to sell Matsa since early 2021. Financial advisers on the sale reached out to several companies that wanted to add copper to their portfolio as its use in green energy is expected to drive demand.

“Copper is essential to achieving a low-carbon world, with the goal of replacing diesel and other petroleum products with greener alternatives. I believe that the future of the industry, society and our lives will depend heavily on copper, as there is no other replacement for it. Perhaps silver could be an option, but it is more expensive. As a result, copper will be the metal that leads the world’s green transition,” Steve Roberston, CEO of Infinitum Copper told MBN.

The sale process takes place in an environment in which copper prices reached a record of US$ 10,747.50 in May. However, prices have fallen after China's state planner announced that it will continue to release copper, aluminum and zinc from its reserves to address disparities between supply and demand.

Matsa owns the Agua Tenidas, Sotiel and Magdalena mines in Spain, which produce copper, zinc and lead concentrates. In 2015, Trafigura sold a 50 percent stake in Matsa to Mubadala for joint investments in base metals. In 2020, MATSA produced more than 300,000 tons of copper concentrate.