China Molybdenum Co. is the latest company to bet on the future of electric cars with its plans to acquire cobalt assets in the Democratic Republic of Congo.
On Monday, Freeport-McMoRan Inc. agreed to sell its controlling stake in the Tenke Fungurume copper-cobalt mine to CMOC, as the Luoyang, China-based company is known, for $2.65 billion. CMOC is also negotiating to buy Freeport’s interests in other cobalt assets.
The deal marks the Chinese company’s entry into cobalt, one of the specialty metals used in rechargeable batteries. The battery market is expanding as more consumers turn to electric cars made by companies such as Tesla Motors Inc. and look to store renewable energy to power appliances when there’s little wind or sunshine.
“I live in Phoenix and Tesla is building a giga factory just next door in Nevada,” Kalidas Madhavpeddi, who heads CMOC International, said in a telephone interview Monday. “Electric cars probably have a growth rate of 11 percent plus a year in terms of batteries. The cobalt market has got a very exciting future.”
Madhavpeddi is also upbeat on copper’s prospects, saying the metal has bottomed out: “If you look at the production side, you have a falling grade for the last 30 years and the supply side won’t be able to keep up in the long term.”
For the rest of this article, click here: http://www.bloomberg.com/news/articles/2016-05-09/cmoc-says-freeport-was-a-reluctant-seller-with-copper-bottoming