China’s Minmetals Resources Ltd. is making a $1.3-billion bid for Montreal-based Anvil Mining Ltd.AVM-T, its second attempt this year to buy a Canadian-based copper producer after being outbid in a recent hostile takeover offer.

Hong Kong-listed Minmetals, which is controlled by a division of Chinese state-owned entity China Minmetals Corp., is taking the friendly route this time with its $8 per share, all-cash offer for Anvil, owner of the Kinsevere project located in the copper-rich Katanga province in the Democratic Republic of Congo.

The proposed offer represents a nearly 40-per-cent premium to Anvil’s closing price of $5.77 on the Toronto Stock Exchange on Thursday, and comes about two months after Anvil said it was considering a sale as part of a strategic review of the company.

The offer also comes six months after Minmetals saw its unsolicited $6.3-billion offer for Toronto-based Equinox Minerals Ltd. topped by an extra $1-billion by Barrick Gold Corp., the world’s largest gold producer. Within hours of Barrick’s bid, Minmetals retreated from the race for Equinox’s operations in Africa and Saudi Arabia, declaring the Toronto-based bullion producer’s $7.3-billion price too rich to match.

It also ended what had been a rare hostile takeover move on the part of a Chinese player in the mining business.

Today, Minmetals appears to be offering a high premium for Anvil to try to prevent a rival bidder from coming forward. Still, there is a chance another miner could make a bid for Anvil which, since it went up for sale in early August, has seen its stock price fall 16 per cent due largely to a global selloff in mining equities.

The lower share price, compared to its 52-week high of $7.24 in July, could also help create a bidding war for Anvil. If that happens, Minmetals may be reluctant to back down again to avoid losing a second battle for a Canadian-based copper producer.

While the price of copper has dropped – from a record $4.60 (U.S.) per pound in February to around $3.25 today amid concerns of a global economic slowdown – producers continue to scramble for what’s left of the world’s shrinking reserves of minerals such as copper. What’s more, with the price of building new mines increasing due to rising energy and labour costs, more miners are willing to pay top dollar for existing production.

And, while the slumping price of copper suggests demand is slowing worldwide, companies are counting on continued strong deliveries to China, the world’s largest consumer of copper, accounting for about 40 per cent of global supply. Copper is used in everything from power lines to plumbing and cell phones, all of which China is making more of as it rapidly builds out its infrastructure to meet a growing population. Even worries of a slowdown in China hasn’t deterred miners from pushing ahead with plans to increase production through acquisitions and expansions.

Minmetals is 71.5-per-cent owned by China Minmetals Non-ferrous, which is controlled by China Minmetals Corp., one of the country’s largest state-owned companies with assets ranging from miners to real estate and finance. Minmetals currently has one mine in Laos and three in Australia that produce zinc, copper, lead, gold and silver. It also operates an alumina trading business.

Any bid to buy Anvil would rely on approval from its 39-per-cent shareholder, Trafigura Beheer BV, the world’s second-largest metals trader behind Glencore.

Trafigura also has an off-take agreement for Anvil’s copper production, which is expected to reach about 36,000 tonnes this year, due in part to the $400-million expansion of the second stage of its Kinsevere project. Kinsevere is expected to produce 60,000 tonnes annually over a 14-year mine life.

Trafigura kick started Anvil’s sale process this summer when it said its stake was not a core part of its business. Trafigura is spinning off assets as it reworks its business model alongside other major trading firms such as Glencore, which went public earlier this year. This week, Trafigura sold 20 per cent of oil storage and supply firm Puma Energy, becoming a minority stakeholder. Puma is expected to go public by early 2013.

The deal requires two-thirds support from Anvil shareholders and is not conditional on financing. Anvil will pay a $53-million break fee if the acquisition falls through under certain circumstances, while Minmetals will pay a reverse break fee of $20-million.