Arizona-based copper producer Phelps Dodge has announced its intention to buy Canadian nickel producers Inco and Falconbridge, two companies themselves still in the process of merging.
If completed, the $56 billion deal would combine the world’s largest nickel company with the largest publicly-traded copper producer, according to a news release issued by the newly-named Phelps Dodge Inco.
“Phelps Dodge Inco will be the world’s leading nickel producer, the world’s largest publicly traded copper producer and a leading producer of molybdenum and cobalt, and it will have a world-class portfolio of growth projects and exciting exploration opportunities,” the news release states.
The corporate office and the new company’s copper division will be headquartered in
The combined company will have operations in more than 40 countries and will employ approximately 40,000 people worldwide.
“This transaction represents a unique opportunity in a rapidly consolidating industry to create a global leader based in
“The creation of this new company gives us the scale and diversification to manage cyclicality, stabilize earnings and increase shareholder returns,” he adds. “At the same time, we are committed to maintaining an investment-grade credit rating throughout the business cycle.”
Several rounds of regulatory, board of directors and shareholder approvals will need to occur before the deal is finalized. Phelps Dodge has said that even if the Inco-Falconbridge merger does not go through, it will continue to pursue acquiring Inco.