Shareholders of Metals Acquisition Corp (MAC) have voted to approve the company’s purchase of Glencore’s Cornish, Scottish and Australian copper mine (CSA mine), alongside the 100% purchase of the mine’s operator, Cobar.
The purchase will cost $1.1bn, with an additional 1.5% copper net smelter royalty, with $775m of this provided in cash upon close of the deal.
MAC stated that the “vast majority” of shareholders voted to approve both the mine’s purchase and the operator’s merger. CSA has been productive in one form or another since 1870, but large-scale production only began in 1964. Despite this, it is estimated to still have a remaining mine life of 14 years. MAC alluded to the fact that there are opportunities to expand the mine life following the purchase.
Cobar Management, an Australian subsidiary of Glencore, has operated the CSA mine in Cobar, New South Wales, since its purchase in 1999. The copper and silver project produces around 40,000 tonnes per annum (tpa), with 40,530t produced in 2021.
The transaction will be supported by Osisko Gold Royalties. Osisko have made an agreement with MAC for the purchase of silver and copper from the site in order to fund MAC’s acquisition.
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Osisko CEO Sandeep Singh stated: “CSA is a high-grade, long-life asset, with significant upside that can be unlocked by the MAC management team. We are pleased to see this important transaction nearing completion and look forward to having both the silver and copper streams contribute to our near-term cash flows.”
Glenore initially began exploring the sale of the CSA mine in 2015 in response to “unsolicited expressions of interest” in the project. Since then, the global miner has been silent on the potential sale.