ResourcesMMG has agreed to acquire the Khoemacau copper mine in Botswana in a deal valued at $1.88bn.
The company will execute the transaction through its indirectly wholly owned subsidiary MMG Africa Ventures.
It will pay for the purchase using shareholder loans and third-party financing and expects the deal to be “immediately earnings accretive”.
The deal will see MMG buying the entire issued share capital of Khoemacau’s parent company Cuprous Capital, which is majority-owned by Cupric Canyon Capital.
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Cupric Canyon Capital is the lead seller in the transaction, with other sellers being the Ferreira Family Trust, Resource Capital Fund VII and the Missouri Local Government Employees’ Retirement System.
The Khoemacau copper mine has the tenth-largest copper mineral resource by total contained copper in Africa, covering a tenement package of 4,040km².
Located in north-west Botswana in the Kalahari Copperbelt, the mine has an annual production capacity of almost 60,000 tonnes (t) of copper and nearly two million ounces of silver.
It has an initial mine life of 27 years and has significant potential for expansion beyond its existing mineral resource base of 450t at 1.4% copper and 18 grams per tonne of silver.
Milling throughput is expected to average 3.6 million tonnes per annum (mtpa) between 2024 and 2026 before it is expanded progressively in 2027 and 2028, increasing from 8.1mtpa to 8.5mtpa from 2029 until the end of the initial mine life.
The average production will range between 50 and 65 kilotonnes per annum (ktpa) between 2024 and 2026, before its expansion in 2027 and 2028.
It can finally reach up to 145ktpa from 2029 until the end of the initial mine life.
MMG chairman Jiqing Xu said: “The addition of Khoemacau to MMG’s international portfolio delivers on our growth strategy and vision – to build a global diversified minerals and metals company and create opportunities for all stakeholders – including our shareholders, employees and communities.
“Khoemacau has significant expansion potential and we look forward to working with the current team to make Khoemacau’s potential a reality.”
The deal, due to be completed in the first half of next year, is pending approvals.