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Chinese metal producer MMG to raise US$1.6 billion selling stocks and bonds

Firm to capitalise on AI-led price spike of critical metals used to create chips, generate electricity and support computing power

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MMG copper mine in Las Bambas, Peru. The Chinese metal producing firm hopes to raise a combined US$1.6 billion selling placement shares and convertible bonds to fund its business expansion. Photo: MMG
Zhang Shidongin Shanghai
MMG, the offshore metal-producing unit of state-backed China Minmetals Corp, plans to raise a combined US$1.6 billion selling placement shares and convertible bonds to fund business expansion amid rising demand for metals driven by artificial intelligence (AI) infrastructure buildout.
The company, which produces metals including copper, zinc and gold, planned to rake in HK$6.27 billion (US$800.4 million) from a placement of 705.9 million shares through the Hong Kong stock exchange.

It also intended to raise US$800 million from the offering of zero-coupon bonds that could be converted into Hong Kong-listed shares in due time, MMG said in a statement to the city’s bourse.

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MMG is taking advantage of a boom on critical metals, which form part of the global AI mania that has fuelled price gains from chip memories to copper and other commodities used to generate electricity to support computing power. Copper futures have risen 15 per cent in New York this year.

However, shares of MMG tumbled 12 per cent to HK$8.58 on Tuesday, erasing all of the annual gain this year. The Hang Seng Index finished the day 1.4 per cent lower.

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Chinese copper producers have been trailing the performance of the metal this year, because of the rotation into AI-linked stocks and concerns about a potential slowdown in global demand, according to HSBC Holdings.

The jitters were overdone and the weakness in copper stocks presented buying opportunities, it added.

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