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Copper tiles
Copper tiles

Miner First Quantum buys Kiwara Add to ...

First Quantum Minerals Ltd. has agreed to buy Kiwara PLC in a cash and share deal worth $260 million to expand its copper mining operations in Zambia, the firms said on Monday.

London shares in Kiwara, which owns the Kalumbila copper project in Zambia, jumped 22.6 per cent to £0.65 after the agreed deal was announced. The shares had nearly tripled so far this year before Monday's news as copper prices recovered.

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London shares in First Quantum, which focuses on copper mining in Africa, had not traded by 0845 GMT.

"Given FQM has an unrivalled track record in development and has its flagship mine that it developed nearby - we think the market may give them the benefit of the doubt," Liberum Capital said in a note.

First Quantum, listed in Toronto and London, said it had received undertakings from shareholders representing 76 per ent of Kiwara shares to accept the offer, which has also been recommended by Kiwara's board.

"We believe our many years of successful operations in the Copperbelt, and Zambia in particular, will be beneficial in the development and eventual operation of the new assets," First Quantum chief executive officer Philip Pascall said.

Under the deal, Kiwara shareholders will receive 0.0085 First Quantum shares and 37.5 pence for every Kiwara share held.

The implied value per Kiwara share is 75 pence, a 41.5 per cent premium to the closing price of Kiwara on Friday.

"Kiwara has recognized that the Kalumbila project and indeed the licence area in general, has potential well in excess of our current resource capability," Kiwara chairman Colin Bird said.

Kiwara is also listed in Johannesburg.



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