TORONTO (miningweekly.com) – US diversified miner Freeport McMoRan on Monday sold its 70% interest in TF Holdings,  which controls an 80% stake in the Tenke Fungurume copper/cobalt mine, in the Democratic Republic of Congo (DRC), for $2.65-billion.

Freeport announced Monday that it had entered into a definitive agreement to sell its interests in TF Holdings to China Molybdenum (CMOC) for $2.65-billion in cash.

The deal provided for a contingent consideration of up to $120-million – $60-million if the average copper price exceeded $3.50/lb and $60-million if the average cobalt price exceeded $20/lb, both during the 24-month period between 2018 and 2019.

Freeport stated that it did not expect a material gain or loss on the transaction and expected to use the net proceeds to repay debt. The company had been selling assets to deal with about $20.8-billion in debt, as at the end of March.

Under pressure from billionaire activist investor Carl Icahn, Freeport had made progress since the start of the year on its asset divestment programme, which had raised over $4-billion in asset sale transactions. Freeport expected to report further progress in the current quarter.

The NYSE-listed miner had also agreed to negotiate exclusively with CMOC to enter into definitive agreements to sell its interests in Freeport Cobalt, including the Kokkola cobalt refinery, in Finland, for $100-million and the Kisanfu exploration, also in the DRC, for $50-million.

Freeport Cobalt included the large-scale cobalt refinery located in Kokkola, Finland, and the related worldwide sales and marketing business, in which Freeport held an effective 56% interest. Kisanfu was a copper and cobalt exploration project, located near Tenke, in which Freeport held a 100% interest.

“This transaction is another significant step to strengthen our balance sheet and enhance value for shareholders,” said Freeport president and CEO Richard Adkerson.

He noted that, since the start of 2016, Freeport had divested more than $4-billion through asset sale transactions. “We are committed to our immediate objective of reducing debt while retaining a large portfolio of high-quality assets and resources and a leading position in the global copper industry,” he stated.

Lundin Mining also held a 24% equity stake in Tenke Fungurume.

Freeport advised that it did not expect the transaction to impact on Tenke’s operations, employment, taxes and benefits provided to the DRC.

The TF Holdings transaction was expected to close in the fourth quarter of 2016, subject to regulatory approvals, CMOC shareholder approval and other customary closing conditions.

CMOC had last month agreed to pay $1.5-billion to buy Anglo American's Brazil-based niobium and phosphates business. According to media reports, the company told the Financial Times last week it had more than $4-billion with which to pursue acquisitions.