Report

Update: Las Bambas valuation revisited

We believe that the Las Bambas acquisition is value accretive for MMG on both NPV and multiples. Our revised valuation of Las Bambas is US$6.9bn or US$1.0bn adjusted for the acquisition cost. Based on our estimates, the deal would put the combined company on a 2016e EV/EBITDA of 3.1x. This compares to MMG’s standalone multiple of 5.5x. We believe the deal is not fully priced in and expect the re-rating of MMG shares to continue.
Underlying
MMG Ltd.

MMG is an investment holding company, engaged in the exploration for mineralization, development of mining projects and the mining, processing and production of copper, zinc, lead, gold and silver. Co.'s segments include: Sepon, an open-pit copper mining operation; Kinsevere, an open-pit copper mining operation; Century, an open-pit zinc mining operation; Rosebery, an underground polymetallic base metal mining operation; Golden Grove, an underground and open-pit base and precious metals mining operation; Las Bambas Project, a development project with prospective exploration options; and Other, which includes exploration and development projects and other corporate entities.

Provider
Edison Investment Research
Edison Investment Research

Edison is an investment research and advisory company, with offices in North America, Europe, the Middle East and AsiaPac. The heart of Edison is our world renowned equity research platform and deep multi-sector expertise. At Edison Investment Research, our research is widely read by international investors, advisors and stakeholders. Edison Advisors leverages our core research platform to provide differentiated services including investor relations and strategic consulting.

.

Other Reports on these Companies
Other Reports from Edison Investment Research

ResearchPool Subscriptions

Get the most out of your insights

Get in touch