Sumitomo Metal Mining and Sumitomo Co.’s $2.2 Billion Sale of Interest in Sierra Gorda Copper Mine

Sullivan & Cromwell and Philippi, Prietocarrizosa Ferrero DU & Uría advised Sumitomo Metal Mining Co. Ltd. and Sumitomo Corporation on the deal.
Herbert Smith Freehills and Cariola, Díez, Pérez-Cotapos advised South32 Limited.

Sumitomo Metal Mining Co. Ltd. (SMM) and Sumitomo Corporation (SC) each entered into definitive agreements to sell to South32 Limited their collective 45 percent interest in Sierra Gorda S.C.M., the operating company for the Sierra Gorda copper mine in Chile’s Antofagasta region. The upfront portion of the deal is valued at approximately $1.7 billion, subject to certain adjustments, with a contingent consideration of up to $500 million linked to price and production thresholds through the end of 2025.

The transaction was more than 18 months in the making and at times required coordination across five or more time zones. It also survived the challenges of the pandemic, which, among other things, presented significant hurdles to facilitating site visits as part of the diligence process.

South32 is an Australian diversified metals and mining company that will take over co-ownership of Sierra Gorda alongside Poland’s KGHM Polska Mied? S.A. Sierra Gorda is expected to produce roughly 180,000 metric tons of copper this year. 
 
The S&C team advising SMM and SC includes Sergio Galvis (Picture), Benjamin Kent and Andrew Ferry. Daniel Bleiberg is advising on tax matters. Juan Rodriguez and Axel Beckmerhagen are advising on antitrust-related matters.

In Chile, Philippi, Prietocarrizosa Ferrero DU & Uría advised SMM and SC with Juan Paulo Bambach, Guillermo Infante, Felipe Ossa Parot and Cristina Olavarría. 

Herbert Smith Freehills advised South32 Limited with Jay Leary, Sarah Benbow, Quentin Digby, Andrew McLean and Adelaide Luke

IN Chile, Cariola, Díez, Pérez-Cotapos advised South32 Limited with Gonzalo Grez, Cristóbal Herrera, Verónica Cuadra, María Belén Fuenzalida and Raúl Álvarez.

 

Involved fees earner: Raúl Alvarez – Cariola, Díez, Pérez-Cotapos & Cía Ltda; Verónica Cuadra – Cariola, Díez, Pérez-Cotapos & Cía Ltda; María Belén Fuenzalida – Cariola, Díez, Pérez-Cotapos & Cía Ltda; Gonzalo Grez – Cariola, Díez, Pérez-Cotapos & Cía Ltda; Cristóbal Herrera – Cariola, Díez, Pérez-Cotapos & Cía Ltda; Sarah Benbow – Herbert Smith Freehills; Quentin Digby – Herbert Smith Freehills; Jay Leary – Herbert Smith Freehills; Adelaide Luke – Herbert Smith Freehills; Andrew McLean – Herbert Smith Freehills; Juan Paulo Bambach Salvatore – Philippi Prietocarrizosa Ferrero DU & Uría; Guillermo Infante Cortés – Philippi Prietocarrizosa Ferrero DU & Uría; Cristina Olavarría – Philippi Prietocarrizosa Ferrero DU & Uría; Felipe Ossa Parot – Philippi Prietocarrizosa Ferrero DU & Uría; Axel Beckmerhagen – Sullivan & Cromwell; Daniel Bleiberg – Sullivan & Cromwell; Andrew Ferry – Sullivan & Cromwell; Sergio Galvis – Sullivan & Cromwell; Benjamin Kent – Sullivan & Cromwell; Juan Rodriguez – Sullivan & Cromwell;

Law Firms: Cariola, Díez, Pérez-Cotapos & Cía Ltda; Herbert Smith Freehills; Philippi Prietocarrizosa Ferrero DU & Uría; Sullivan & Cromwell;

Clients: South32 Limited; Sumitomo Corp.; Sumitomo Metal Mining Co.;

Author: Martina Bellini