Lundin Mining has closed the acquisition of a 100% ownership stake in Mineração Maracá Indústria e Comércio, a firm which owns the Chapada copper-gold mine in Brazil.
Production at the Chapada mine started in 2007. It has additional gold production developed by Yamana and is expected to produce 54.5kt of copper and 100koz of gold this year. Last year, it produced approximately 58.6kt of copper and 121koz of gold.
Lundin and Yamana initially signed an acquistion agreement in April.
Lundin Mining president and CEO Marie Inkster said: “The addition of Chapada further solidifies Lundin Mining’s position as a leading intermediate base metals producer.
“Leveraging our technical expertise, base metals focus and financial strength, we believe further opportunities exist to create meaningful stakeholder value from this high-quality asset.”
On closing of the acquisition, Yamana received $800m in cash from Lundin and a part of the latter’s $550m revolving credit facility.
Yamana also received a contingent consideration of up to $125m over a five-year period and another $100m on the potential construction of a pyrite roaster to optimise the operation.
Following the sale of the Chapada mine, Yamana will have a production platform of five mines in the Americas, comprising two sites in Chile, and one in Canada, Brazil and Argentina respectively.
It retains a 2% net smelter return (NSR) royalty on future gold production from the Suruca gold deposit in the Chapada complex.
Based in Canada, Lundin Mining is a metals mining company with operations in Brazil, Chile, Portugal, Sweden and the US. The company is primarily engaged in the production of copper, nickel and zinc.