Shareholders of copper giant
Freeport-McMoRan (NYSE:
FCX)
had been waiting a while for the company to "do something," and they
certainly got their wish on Wednesday, though almost certainly not in
the fashion they were expecting. While many analysts and investors had
been looking for Freeport-McMoRan to announce a big move with its
capital, either a sizable
buyback/special
dividend or further diversification in mining, almost nobody expected
the big move into energy that the company announced Wednesday morning.
Not
only does the sheer size of the transactions make this a risky move for
Freeport-McMoRan, but so too do the details. In buying
Plains Exploration & Production (NYSE:
PXP) and
McMoRan Exploration (NYSE:
MMR),
Freeport is buying two companies that are not exactly non-controversial
assets in their own right. Consequently, this looks like a pretty
high-risk/high-reward transaction for this copper mining giant.
Please continue here:
http://www.investopedia.com/stock-analysis/2012/Freeport-McMoRan-Announces-A-Real-Doozy-FCX-PXP-MMR-BP1206.aspx
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