An investment firm backed by Chinese state-owned Jiangxi Copper Company Ltd. has amassed a 10.8-per-cent stake in First Quantum Minerals Ltd., sending shares of Canada’s biggest copper miner sharply higher.
In September, The Globe and Mail reported that Vancouver-based First Quantum had hired bankers to fend off a potential takeover bid from Jiangxi Copper after the price of its stock had fallen over the past few months.
First Quantum later said it hadn’t discussed selling the company outright, but acknowledged it had held talks about selling a stake in its Zambian assets. On Thursday, the company said in a statement that in recent months it has been “in discussions with Jiangxi Copper regarding a possible investment in the Zambian assets of the company,” but there was “no certainty that any transaction will proceed.”
Clement Kwong, managing director of Pangaea Investment Management Ltd., the investment vehicle through which Jiangxi Copper is making its investment in First Quantum, said Jiangxi and First Quantum have engaged in talks about the Zambian assets for “a very long time,” but “nothing’s actually come of it.”
He said that Jiangxi had concerns about uncertainties in Zambia, and the trade war between the United States and China that has weighed on the copper market has also given it pause.