The BHP Group Ltd (ASX: BHP) share price is pushing higher on Thursday.
In afternoon trade, the mining giant's shares are up 0.5% to $39.98.
This follows the release of an announcement this morning and a broad market rally.
What was announced?
This morning, BHP announced that it has completed an acquisition that it expects will support the artificial intelligence market.
According to the release, BHP Investments Canada and Lundin Mining have completed the acquisition of Filo Corp. It is a Toronto Stock Exchange-listed company that owns 100% of the Filo del Sol (FDS) copper project.
The large-scale, high-grade sulphide deposit at the FDS project is considered to be one of the most significant copper discoveries globally in recent decades.
As part of the deal. BHP Canada and Lundin Mining have formed the Canadian-incorporated joint venture company, Vicuña Corp.
This joint venture will hold the FDS copper project and the Josemaria copper project located in the Vicuña district of Argentina and Chile. BHP and Lundin Mining will each own 50% of the joint venture.
Artificial intelligence support
BHP's CEO, Mike Henry, highlights that the acquisition will support increased demand for copper. This is being driven by the data centre market, which is growing rapidly due to the high needs of artificial intelligence. He said:
BHP is pleased to be partnering with Lundin Mining in the Vicuña Joint Venture, an exciting new copper growth opportunity for both companies.
Leveraging the complementary capabilities of Lundin Mining and BHP, the development of Vicuña's projects aims to deliver substantial value to shareholders, as well as to other stakeholders. The projects will be developed and will operate in line with international industry standards.
BHP is one of the world's leading producers of copper, a metal essential to global economic growth, the energy transition and to the rapidly growing demand for data centres to support the harnessing of artificial intelligence.
Transaction details
The total consideration for the Filo Corp acquisition was C$4.0 billion, excluding the Filo shares already held by Lundin Mining and BHP, respectively.
BHP's share of the consideration for the acquisition was C$2.0 billion (US$1.4 billion) in cash at C$33.00 per Filo Corp. share. Though, it estimates that its total cash payment for the entire transaction was US$2.0 billion.
Whereas Lundin Mining's share of the consideration for the Filo Acquisition was C$877.8 million in cash and 94.1 million Lundin Mining shares.
