Freeport-McMoRan Inc. said it would sell its stake in an African surface-mining operation to a Chinese mining-and-processing firm for $2.65 billion in cash, as Freeport looks to pay down debt.

Phoenix-based Freeport said it would sell its interests in TF Holdings Limited, a Bermuda holding company that indirectly owns an 80% interest in the Tenke Fungurume mine in the Democratic Republic of the Congo, to China Molybdenum Co. Freeport has a 70% stake in TF Holdings, and an effective 56% interest in Tenke.

Freeport, the U.S.'s biggest mining company by market value, made a big bet on oil and gas in 2013 when it bought McMoRan Exploration Co. and Plains Exploration & Production Co. for a total of $9 billion. The purchase loaded the company with debt just before a steep decline in energy prices.

Last month, Freeport announced it would cut 25% of the oil-and-gas workforce, or 325 jobs, as part of an overall restructuring in that business. The company said it is evaluating options for the oil-and-gas business, including possible asset sales or joint-venture arrangements. Since the beginning of this year, the company has announced more than $4 billion in asset-sale transactions.

The TF Holdings transaction, subject to regulatory approvals and other closing conditions, is expected to close in the fourth quarter of this year. Freeport said it doesn't expect the transaction to affect Tenke's operations, which employs about 3,400 full-time workers and 4,200 contractors.

In addition to the TF Holdings transaction, Freeport said it would negotiate exclusively with China Molybdenum to enter into agreements to sell its interests in joint venture Freeport Cobalt, which includes the Kokkola Cobalt Refinery in Finland, for $100 million. The company also seeks to sell the Kisanfu Exploration project in the Democratic Republic of Congo for $50 million.

Last month, Freeport said revenue fell 15% to $3.5 billion in the latest quarter as it posted a $4.2 billion quarterly loss mostly on the declining book value of its oil and gas assets. The company said it would continue to ramp up copper production despite stagnating prices.

Write to Joshua Jamerson at joshua.jamerson@wsj.com

 

(END) Dow Jones Newswires

May 09, 2016 08:25 ET (12:25 GMT)

Copyright (c) 2016 Dow Jones & Company, Inc.
Freeport McMoRan (NYSE:FCX)
Historical Stock Chart
From Feb 2024 to Mar 2024 Click Here for more Freeport McMoRan Charts.
Freeport McMoRan (NYSE:FCX)
Historical Stock Chart
From Mar 2023 to Mar 2024 Click Here for more Freeport McMoRan Charts.