Reuters reported that Chile's Molymet plans to invest USD 400 million in the next five years to increase output of the metal used to strengthen steel.

The investment figure is separate from the company's announcement last week that it would buy a 13% stake in Delaware based rare earth producer Molycorp in a deal worth around USD 390 million and a potential project with China Molybdenum for USD 70 million.

Mr John Graell CEO of Molymet said that "Annual average investment will be around USD 80 million over five years, without taking into account big acquisitions like Molycorp's."

The purchase of Molycorp will increase Molymet's net profit by 50 percent as of 2013 and double it within five years, he said. The Chilean company wants to bolster its presence in strategic metals.

Graell said that the company is also eyeing a deal with China Molybdenum, with which it has a joint venture in LuoMo High Tech, to run another plant together.

Molymet, which supplies more than 30% of global molybdenum products, posted a USD 103.25 million net profit in 2011, a 12.6% increase compared with a year earlier. It operates in Chile, Mexico, Germany, Belgium and China.

(Sourced from www.reuters.com)