Anglo American has reached agreement to sell its Mantoverde and Mantos Blancos copper mines in northern Chile for an up-front cash consideration of $300 million, with potential upside of up to $500 million. The mines are held by an Anglo subsidiary company, Anglo American Norte. Mantos Blanco produced 52,400 mt of copper in 2014; Mantoverde produced 51,900 mt.

The buyers are an investor consortium led by Audley Capital Advisors, with Orion Mine Finance as the principal co-investor. The initial consideration of $300 million is payable at closing. Future payments could add up to another $200 million, contingent upon factors that include London Metal Exchange copper price performance and any future decision to pursue the potential sulphide life extension of the Mantoverde mine.

Anglo American Chief Executive Mark Cutifani said, “In line with our strategic objectives, we are focusing our diversified portfolio on our largest and most value accretive assets, which include the Los Bronces and Collahuasi copper mines in Chile and the Quellaveco copper project in Peru.”

MacKenzie said, “I am delighted that, together with Orion, we are to acquire the Mantoverde and Mantos Blancos mines. I know both of these operations well and can see the scope to further enhance the business under our ownership, particularly in terms of their life extension potential to meet our expected view of constrained copper supply in the medium and longer term. I have a high regard for the team of people who work at these operations and believe that Chile remains one of the most attractive destinations for mining investment.”

The transaction is not subject to any regulatory conditions and is expected to close in the third quarter of 2015.