Kazakhmys, which is listed on the London Stock Exchange, had been in talks with Russia's Metalloinvest since at least July, according to sources. Kazakhmys market capitalization has fallen about 87% in the past five months to £1.42 billion ($2.46 billion), dragged lower by a steep decline in the wider stock market, falling copper prices and fears that an economic global downturn will result in a sharp drop in demand for the commodity.
"Discussions regarding a possible combination with a third party, first announced on 14 July 2008, have ended," Kazakhmys said in a statement.
The breakdown of the talks is the latest in a series of disappointments for dealmakers in the mining sector. Earlier this week Rio Tinto Group said plans to offload about $10 billion of assets by the end of the year could be delayed and warned that demand from key markets like China was slowing. Xstrata plc, on Oct. 1, pulled a £5 billion ($8.6 billion) offer for platinum miner Lonmin plc, blaming uncertain financing conditions. Another London-based miner, Vedanta Resources plc, is reportedly planning to pull an agreed bid for bankrupt copper miner Asarco LLC of Tucson, Ariz. - Paul Whitfield
