Aug 24 – Standard Poor’s Ratings Services said that its ratings and
outlook on Corporacion Nacional de Cobre del Chile (Codelco; A/Stable/–) are
not affected following a potential legal settlement with Anglo American PLC
(BBB+/Stable/A-2) over the ownership status of Anglo American Sur SA (not
rated). According to the agreement, Codelco will acquire a 24.5% stake in Anglo
Sur for $1.8 billion through a joint venture with Mitsui Co. Ltd., which will
also acquire an additional 5% stake in Anglo Sur. At the same time, Mitsubishi
Corp. will keep its 20.4% stake, and Anglo American will retain the control of
Anglo Sur with 50.1%. Mitsui will provide Codelco a seven-year nonrecourse loan,
at a cost of LIBOR plus 2.5%, to fund the transaction. Codelco will repay the
loan with the dividend proceeds from Anglo Sur. Until the loan is repaid, we do
not expect Codelco to receive dividends from Anglo Sur, therefore, we consider
the final agreement as credit neutral in the short term.
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