Australian mining and metals company South32 has acquired remaining 83% of issued and outstanding shares of Canadian mineral exploration company, Arizona Mining, for $1.3bn.
According to the terms of the deal signed by the companies in June this year, South32 agreed to pay C$6.20 ($4.70) a share for the 83% stake in Arizona Mining it does not already own.
South32 CEO Graham Kerr said: “The acquisition of Arizona Mining adds to our portfolio one of the most exciting base metal projects in the industry.
“Our deep understanding of the high-grade Hermosa project and surrounding land package, together with our extensive experience at Cannington, positions us well to bring the project to development and deliver significant value to our shareholders.”
Arizona Mining owns the Hermosa project, which comprises the high-grade base metals Taylor deposit, the Central zinc, manganese and silver oxide resource as well as an extensive, prospective land package with potential for discovery of polymetallic and copper mineralization.
With completion of the deal, South32 plans to move ahead with the development of the Hermosa project located 80km southeast of Tucson, Arizona, in the coming weeks.
As part of the plan, South32 intends to undertake work including optimizing studies and commencing the exploration decline.
The exploration decline will allow drilling to test for extensions and further improve the company’s understanding of the existing high-grade resource.
Kerr earlier said that the cash offer for Arizona Mining will allow South32 to optimize the design and development of one of the most exciting base metal projects in the industry.
Kerr added: “Our deep understanding of this high grade resource and surrounding tenement package, and extensive experience at Cannington, makes us the natural owner of this project and ensures we are well positioned to bring it to development, delivering significant value to our shareholders.”
Following the transaction, Arizona Mining was delisted from the Toronto Stock Exchange (TSX).
South32 currently has operations in Australia, Southern Africa and South America and produces bauxite, alumina, aluminium, energy and metallurgical coal, manganese, nickel, silver, lead and zinc.