Creating a major new Canadian mining house

first_imgHudBay Minerals and Lundin Mining have agreed to a business combination that will create a new Canadian leader in global mining. After the combination, HudBay is expected to be the second largest base metals company in Canada measured by market capitalisation. It will have a broad portfolio of producing assets in Canada, Portugal, Sweden, Spain, and Ireland, along with a strong growth pipeline that includes the world-class Tenke Fungurume and Fenix projects, located in the DRC and Guatemala, respectively. The Transaction will be structured as a plan of arrangement under the Canada Business Corporations Act. Highlights of the Transaction include:On completion, each Lundin common share will be automatically exchanged for 0.3919 HudBay common shares, and Lundin will become a wholly-owned subsidiary of HudBayThe consideration Lundin shareholders will receive pursuant to the Transaction represents approximately a 32% premium over Lundin’s 30 day volume weighted average trading price on the TSX based on HudBay’s 30 day volume weighted average trading price on the TSXOn completion of the Transaction, HudBay will have approximately 306 million common shares outstandingThe CEO of the resulting company will be Allen J. Palmiere.The boards of directors of both companies have approved the Transaction with all voting members in favour.Following the completion of the Transaction, the combined company’s profile will include:Combined 2007 actual metal production of 187,115 t of copper, 278,289 t of zinc, 44,560 t of lead, 3,270 t of nickel, 102,587 oz of gold, and 4,184,536 oz of silverCash on hand of approximately C$900 million and total debt of approximately $240 million based on reported amounts at September 30, 2008The financial strength to capitalise on opportunities arising from turbulent marketsA strong management team and an experienced board.“The combination of HudBay and Lundin creates a company that is financially strong, has excellent internal growth projects, and has the size and strength to take advantage of opportunities over the next 18 months,” said Phil J. Wright, President and CEO of Lundin. “This arrangement is in the best interest of Lundin shareholders, and I look forward to making a contribution toward building what has the potential to be a major new Canadian mining house.”“We’re excited to create a Canadian base metals company that we believe will be a major presence on the world stage,” added Allen J. Palmiere, CEO of HudBay. “We will continue to grow the company with discipline, and use its financial strength with a view to creating future value for all of our shareholders.”Following the completion of the transaction, HudBay’s board will be composed of Allen J. Palmiere, Philip J. Wright, Lukas Lundin, M. Norman Anderson, Colin K. Benner, Donald K. Charter, Ronald P. Gagel, R. Peter Gillin, and William A. Rand.In connection with the Transaction, HudBay and Lundin have entered into a loan agreement, pursuant to which HudBay will lend Lundin approximately C$135.8 million on a subordinated basis. Lundin will use the proceeds of the loan to fund capital investments and other general corporate purposes. HudBay and Lundin have also entered into a share purchase agreement, pursuant to which HudBay will acquire approximately 97 million common shares of Lundin, representing approximately 19.9% of Lundin’s outstanding common shares, at a price of C$1.40 per share in a private placement for total gross proceeds to Lundin of approximately C$135,800,000. The proceeds of the private placement will be used to repay the loan. Completion of the private placement of the Lundin common shares is subject to the satisfaction of certain regulatory requirements.HudBay is a leading base metals mining company with assets in North and Central America. The company is investing for the future in one of the most ambitious exploration programs in Canada, targeting its 400,000 ha exploration territory in the Flin Flon Greenstone Belt. An integrated mining company, HudBay operates zinc and copper mines, concentrators and metal production facilities in northern Manitoba and Saskatchewan, a zinc oxide production facility in Ontario, the White Pine Copper Refinery in Michigan, and owns the Fenix nickel project in Guatemala. In addition to its primary products, the company also produces gold, silver and zinc oxide.Lundin Mining is a rapidly growing, diversified base metals mining company with operations in Portugal, Spain, Sweden and Ireland, producing copper, nickel, lead and zinc. In addition, Lundin Mining holds a development project pipeline which includes the world class Tenke Fungurume copper/cobalt project in the DRC and holds an extensive exploration portfolio and interests in international mining and exploration ventures.last_img

first_imgHudBay Minerals and Lundin Mining have agreed to a business combination that will create a new Canadian leader in global mining. After the combination, HudBay is expected to be the second largest base metals company in Canada measured by market capitalisation. It will have a broad portfolio of producing assets in Canada, Portugal, Sweden, Spain, and Ireland, along with a strong growth pipeline that includes the world-class Tenke Fungurume and Fenix projects, located in the DRC and Guatemala, respectively. The Transaction will be structured as a plan of arrangement under the Canada Business Corporations Act. Highlights of the Transaction include:On completion, each Lundin common share will be automatically exchanged for 0.3919 HudBay common shares, and Lundin will become a wholly-owned subsidiary of HudBayThe consideration Lundin shareholders will receive pursuant to the Transaction represents approximately a 32% premium over Lundin’s 30 day volume weighted average trading price on the TSX based on HudBay’s 30 day volume weighted average trading price on the TSXOn completion of the Transaction, HudBay will have approximately 306 million common shares outstandingThe CEO of the resulting company will be Allen J. Palmiere.The boards of directors of both companies have approved the Transaction with all voting members in favour.Following the completion of the Transaction, the combined company’s profile will include:Combined 2007 actual metal production of 187,115 t of copper, 278,289 t of zinc, 44,560 t of lead, 3,270 t of nickel, 102,587 oz of gold, and 4,184,536 oz of silverCash on hand of approximately C$900 million and total debt of approximately $240 million based on reported amounts at September 30, 2008The financial strength to capitalise on opportunities arising from turbulent marketsA strong management team and an experienced board.“The combination of HudBay and Lundin creates a company that is financially strong, has excellent internal growth projects, and has the size and strength to take advantage of opportunities over the next 18 months,” said Phil J. Wright, President and CEO of Lundin. “This arrangement is in the best interest of Lundin shareholders, and I look forward to making a contribution toward building what has the potential to be a major new Canadian mining house.”“We’re excited to create a Canadian base metals company that we believe will be a major presence on the world stage,” added Allen J. Palmiere, CEO of HudBay. “We will continue to grow the company with discipline, and use its financial strength with a view to creating future value for all of our shareholders.”Following the completion of the transaction, HudBay’s board will be composed of Allen J. Palmiere, Philip J. Wright, Lukas Lundin, M. Norman Anderson, Colin K. Benner, Donald K. Charter, Ronald P. Gagel, R. Peter Gillin, and William A. Rand.In connection with the Transaction, HudBay and Lundin have entered into a loan agreement, pursuant to which HudBay will lend Lundin approximately C$135.8 million on a subordinated basis. Lundin will use the proceeds of the loan to fund capital investments and other general corporate purposes. HudBay and Lundin have also entered into a share purchase agreement, pursuant to which HudBay will acquire approximately 97 million common shares of Lundin, representing approximately 19.9% of Lundin’s outstanding common shares, at a price of C$1.40 per share in a private placement for total gross proceeds to Lundin of approximately C$135,800,000. The proceeds of the private placement will be used to repay the loan. Completion of the private placement of the Lundin common shares is subject to the satisfaction of certain regulatory requirements.HudBay is a leading base metals mining company with assets in North and Central America. The company is investing for the future in one of the most ambitious exploration programs in Canada, targeting its 400,000 ha exploration territory in the Flin Flon Greenstone Belt. An integrated mining company, HudBay operates zinc and copper mines, concentrators and metal production facilities in northern Manitoba and Saskatchewan, a zinc oxide production facility in Ontario, the White Pine Copper Refinery in Michigan, and owns the Fenix nickel project in Guatemala. In addition to its primary products, the company also produces gold, silver and zinc oxide.Lundin Mining is a rapidly growing, diversified base metals mining company with operations in Portugal, Spain, Sweden and Ireland, producing copper, nickel, lead and zinc. In addition, Lundin Mining holds a development project pipeline which includes the world class Tenke Fungurume copper/cobalt project in the DRC and holds an extensive exploration portfolio and interests in international mining and exploration ventures.last_img

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