Fortescue (ASX:FMG) Digs Deeper Into Copper with Alta Acquisition

Fortescue’s C$139M Alta Deal Explained

Fortescue (ASX:FMG) is moving to acquire the remaining 64 percent of Alta Copper Corp, a Canadian explorer focused on Peruvian copper, in a C$139M all cash deal. If completed, this would mark a meaningful expansion of Fortescue’s copper footprint. The board’s decision signals strong confidence in the copper macro backdrop and also gives Fortescue a more diversified commodity mix, given the business is still predominantly tied to iron ore. With global demand for copper rising due to its high conductivity and central role in electrification, the strategic logic here is clear.

Alta’s project has the potential to produce about 134,000 tonnes of copper each year, with construction costs estimated at roughly US$3.3B. This move reflects Fortescue’s attempt to position itself ahead of what could be a multi decade copper cycle driven by EVs, grid upgrades, and clean energy infrastructure. The opportunity is substantial, but so is the execution risk. Large scale copper developments in Peru come with permitting, geopolitical, and construction hurdles. Investors will need to weigh Fortescue’s balance sheet strength against the long lead times and capital intensity of this project.

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A Strategic Bet on Copper’s Next Boom

Fortescue, through its subsidiary Nascent Exploration, which already owns 36% of Alta Copper, is offering an all cash deal for the remaining shares. The transaction is expected to close in early 2026 pending approvals. Given the premium being offered, it appears Fortescue is willing to pay up based on its view that copper will be a long term value creation asset.

A 2024 Preliminary Economic Assessment by Ausenco underscores the project’s potential. It outlines a net present value of US$1.01B and an internal rate of return of 16.3 percent, assuming a copper price of US$3.50 per pound. Expected annual output includes 134,000 tonnes of copper, 61,000 ounces of gold, and 1.2 million ounces of silver. The project sits at an advanced exploration stage, supported by ongoing community engagement, infrastructure assessments, and permitting work.

Progression from here will require multi-year regulatory processes, environmental approvals, and close partnership with local stakeholders. Fortescue has indicated it will prioritise these areas post-acquisition, including additional drilling to update resources under the JORC code and strengthening its sustainable development commitments.

The Investors Takeaway for FMG

For investors currently holding Alta Copper, the offer means your shares would be bought out at a premium, which supports capital gains on your holding. For new or existing Fortescue investors, the acquisition can also be viewed positively. It is unlikely to be dilution unless the agreement changes, meaning your ownership is not expected to be reduced through additional share issuance. The acquisition is also expected to be funded through Fortescue’s cash flows, which further protects shareholders.

From a long-term perspective, if Fortescue can bring the Alta Copper deposit into profitable production, supported by the broader trend of rising copper prices, this asset could become a meaningful contributor to the company’s value and diversification strategy.