Copper pot stills are seen at the Diageo Roseisle distillery in Scotland March 20, 2014. Scotch whisky distillers are burning their unwanted grain byproducts, wood chips and other types of biomass for a source of energy in remote areas of the Highlands, w
Copper pot stills are seen at the Diageo Roseisle distillery in Scotland March 20, 2014. Scotch whisky distillers are burning their unwanted grain byproducts, wood chips and other types of biomass for a source of energy in remote areas of the Highlands, where gas links are scarce and fuel oil is pricey. The production of Scotch whisky has evolved over more than 500 years and is steeped in tradition. It is also a big business, generating 4 billion pounds ($6 billion) a year in exports - a quarter of all Britain's food and drink sales abroad. Photograph taken March 20, 2014. REUTERS/Russell Cheyne REUTERS/Russell Cheyne

China is still definitely on the lookout for commodities. Chinese consortium MMG has just bought from Glencore Xstrata the latter's Las Bambas copper mine in Peru for AU$6.22 billion in cash.

Based in Melbourne's Southbank, MMG is controlled by state-owned China Minmetals and has a 62.5% stake in the consortium. The rest, at 22.5 per cent and 15 per cent, are held by Guoxin International Investment and Citic Metal, respectively.

Hong Kong-listed MMG has mines in Australia and the Democratic Republic of Congo.

"The acquisition of Las Bambas is an important milestone for outbound Chinese investment in the global resources industry and also for our partners GXIIC and CITIC," Zhou Zhongshu, China Minmetals president, MMG's major shareholder, said.

China's competition authorities had stipulated on conditions that it would approve the merger of Glencore and Xstrata only until the former agrees to sell its Las Bambas copper mine. Beijing rationalised this is meant to dissuade the merged entity from dominating the global copper market.

"In our view, the agreed consideration offers a surprise to the upside ... The transaction is another testament to Glencore CEO Ivan Glasenberg's strong deal-making credibility and the fact that he is willing to play a long game," Bernstein Research analysts said in a note.

"In addition, it underlines the global scarcity of large high-quality copper deposits and the continued Chinese demand for this metal."

Once the deal is completed, Glencore will receive $5.85 billion in cash, which is contained between the $5 billion and $6 billion that analysts' predicted. The Chinese consortium will also pay the mine's capital expenditure and development costs from the start of 2014 until the deal closes. As of March 31, such expenses amounted to about $400 million.

"Our view [on the acquisition] is fairly positive," Matthew Whittall, a metals and mining analyst at Investec, told Finance Asia. "What drives that view is MMG's access to low-cost debt. Their cost of debt is 3-5 per cent and, on that basis, it is easy to justify the acquisition given their low cost of capital," he said.