FCX buys PD

PD ( Phelps Dodge ) failed in it's bid to buy N ( Inco ) and FAL ( Falconbridge ). FCX ( Freeport McMoRan ) is going to buy out PD. The buy out price is $126.46 and will pay PD shareholders $88.00 in cash and .67 shares of the combined company.

In a future post, I will look at how this deal will look. It will produce around $18 billion in debt on Freeport's books. If copper and gold prices remain high, this could be a great deal and the debt could be paid off real fast. The combined company will have a very low PE and could be a super company to buy.

If metal prices dive, this will be a bad company to get into. I will give a complete analysis next week.

GL investors