The $85bn Anglo Teck copper deal shows majors believe in a long copper bull run

• Anglo American and Teck Resources to merge in $85bn tie-up, the sector’s second-biggest M&A deal ever
• Transaction could spark further consolidation activity in Latin America
• Majors’ bets on copper show junior copper explorers are playing in the right space

After successfully resisting takeover attempts from BHP and Glencore, respectively,  Anglo American and Teck Resources are joining forces in an $85billion merger, eclipsed only by Glencore’s $90bn acquisition of Xstrata in 2013.

The deal comes after Anglo rejected a £39bn approach from BHP last year, while Teck fought off a $22.5bn bid from Glencore in 2023, selling its coal assets to the trader as a makeweight.

The 12–18 month regulatory approval timeline leaves both companies potentially vulnerable to interloping bids, with analysts highlighting BHP, Rio Tinto and Glencore as possible suitors who might still attempt to disrupt the transaction.

Anglo American and Teck Resources will maintain the merged company’s headquarters in Vancouver while keeping its primary stock exchange listing in London, as part of commitments designed to secure Canadian regulatory approval.

The merged entity will control six world-class copper mines and generate ~70% of its revenue from copper operations, making it the world’s fifth largest copper producer.

Key synergies are expected from the companies’ adjacent Chilean operations at Collahuasi and Quebrada Blanca, located just 40 kilometres apart, which could unlock an additional 175,000t of annual copper production and $1.4bn of annual EBITDA.

The zero-premium deal, structured to generate $800m in annual cost savings by the fourth year following completion, will see Anglo shareholders retain 62.4% of the combined entity (to be called Anglo Teck plc), while Teck investors will hold 37.6%.

Both Anglo and Teck have undergone significant restructuring in recent years, with Teck selling its steelmaking coal business to Glencore for $6.93bn in the wake of the failed take-over attempt.

Anglo demerged its platinum arm into Valterra Platinum, is trying to shed its diamond business De Beers and almost had a US$3.8bn sale of its met coal mines in Queensland signed off before Peabody called the deal off after a fire at one of its mines.

Copper consolidation

It’s not a done deal. The tie-up shows how important copper supremacy is now in the mining industry, with the commodity linked to key investment trends like urbanisation, electrification, EVs and infrastructure development.

If Anglo and Teck want each other, there could be no shortage of alternative buyers who want their high quality Chilean and Peruvian mines.

“We actually see AAL as the more attractive target, given a larger and higher quality copper portfolio and less “frictions” to closing (i.e., no Investment Canada review or dual-class share structure). We see BHP, RIO and GLEN all as potential bidders for both companies. We also wouldn’t rule out AEM or FCX as a potential interloper for TECK,” Canaccord Genuity’s Dalton Baretto, who called the combined portfolio “clearly world class”, said.

Industry observers suggest the merger could trigger further consolidation activity as remaining mid-tier miners in Latin America seek scale to remain competitive.

Chile is home to three of the world’s largest copper mines, led by BHP and Rio Tinto’s Escondida operation in Antofagasta, and is consistently the world’s largest copper producer.

Peru also played a major role in Latin American copper production in 2024, delivering nearly 30% of the region’s output, while Mexico and Brazil added 7.5% and 4.1%, respectively.

And junior explorers in the region are beginning to carve out a larger share of the copper space thanks to their vital role in early-stage exploration and development.

Norfolk Metals (ASX:NFL) , owners of the Carmen copper asset in Chile’s northern Atacama region, is an active junior in Latin America.

The company has embarked on a major 5100m drilling campaign to unlock the potential for a low-cost, high-margin heap leach operation, just 16km from the Nueva Unión joint venture between Teck and Newmont, which is developing the multi-billion-dollar Relincho and Fortuna deposits.

Speaking on the Teck-Anglo deal, NFL executive chairman Ben Phillips said synergies between Teck’s Quebrada Blanca and Anglo’s Collahuasi were central to the transaction.

“Achieving increased production at lower capital intensity makes sense,” he said.

“This transaction further strengthens and solidifies the narrative of copper and importantly Chilean copper being a hot investment destination.”

Majors chasing scale and Tier 1 projects

Other ASX juniors are active in Chile and Peru.

Hot Chili (ASX:HCH), which recently ran a $14m rights issue to fast-track its Costa Fuego copper-gold and Huasco Water projects in Chile’s Atacama region, is among only a handful to boast an asset of real scale.

Costa Fuego includes both the Cortadera and Productora deposits, as well as the newly defined La Verde copper-gold discovery.

It boasts probable reserves of 502Mt at 0.37% copper, 0.1g/t gold, 0.49g/t silver and 97ppm molybdenum and is one of the largest-scale, lowest-elevation copper resources in the world not already controlled by a major miner.

Over in Peru Mammoth Minerals (ASX:M79), formerly listed as Firetail Resources, recently raised $5m to carry out exploration across its high potential gold and copper portfolio.

While its attention has also been trained in Canada and on newly acquired gold assets in Nevada, progress at the company’s Picha project in Peru is being fast-tracked through its inclusion in the 2025 BHP Xplor accelerator, which supports early-stage ventures targeting critical minerals for a low-carbon future.

Selected companies receive up to $500,000 in equity-free funding, technical and business mentorship, and access to BHP’s industry network to accelerate their concepts into viable projects.

That support comes at a pivotal time, as rising demand from EVs and AI puts pressure on global supply. That narrative and the M&A interest across the copper space is powering interest in Australian-focused juniors as well.

“There haven’t been the sort of the discovery rates that we’ve seen in decades gone by, which means we aren’t replacing the reserves that are being mined at a quick enough pace,” QMines (ASX:QML) executive chairman Andrew Sparke told Stockhead. His company is aiming to restart a dormant copper hub near Rockhampton in Queensland.

“A lot of M&A activity at the moment is targeting copper exposure and I note recently, even in Australia on a smaller scale, Harmony Gold has just bought MAC Copper, which goes to show a lot of the big gold producers with strong balance sheets seem to be acquiring deposits that give them access to copper supply,” Sparke added.

“The transaction demonstrates that these larger companies are preparing for what they expect to be a long copper bull run.”

At Stockhead, we tell it like it is. While Norfolk Metals, Hot Chili, QMines and Mammoth Minerals are Stockhead advertisers, they did not sponsor this article.