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A Lundin mine in central Sweden.

PETTER KOUBEK/VIA BLOOMBERG NEWS

The chief executive officer of Lundin Mining Corp. says the base-metals miner has "some work to do to get confidence back" after the recent sharp selloff in its stock. But Paul Conibear is also shrugging off any suggestions that the company was slow to disclose a damaging rock slide at its flagship mine.

Shares in the Toronto-based company have fallen roughly a fifth since Nov. 29, the date it disclosed a rock slide is hampering operations at its Candelaria copper complex in Chile. Production at the mine, which accounts for more than half of its revenue, will be 20 per cent lower next year than previously indicated, due to the slide. The company waited about a month after the slide happened to disclose the news to investors.

"It should have come out much sooner," said Haywood Securities Inc. analyst Pierre Vaillancourt in an interview on Dec. 1.

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"It's a material event and you can't just hold on to that information."

This past Thursday, a proposed class-action lawsuit seeking $175-million in damages on behalf of investors who acquired shares in Lundin between Oct. 25 and Nov. 29 was filed in the Ontario Superior Court against the company and a number of its officers and directors, including Mr. Conibear and chairman Lukas Lundin. The suit, which was brought by Strosberg Sasso Sutts LLP and Groia & Company PC , alleges that Lundin "failed to make timely disclosure" of the rock slide to investors.

"The company believes these allegations are without merit and intends to vigorously defend against the matter," wrote Lundin spokesperson Sonia Tercas in an e-mail to the Globe and Mail on Friday.

In an interview last week, Mr. Conibear explained why it it took about four weeks to get the word out about the slide. Initially, the company didn't know the magnitude of the slide, whether other slides were likely, how long it might take to remove the waste, what methods it would use, and how much it would all cost. Putting together a detailed plan and getting board approval took some time he said.

Still, after witnessing the worst selloff in the company's shares in six years, after the event was disclosed, Mr. Conibear was taken aback.

"It shocked us, to be honest," he said.

Lundin could have done a better job in the initial disclosure on Nov. 29, he said, and provided more detailed information right away on the slide, so shareholders could put the event in better context.

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"I guess people said 'Oh they've had a rock slide,' and they think of the Kennecott disaster a few years ago, that closed a pit for a year. It's nothing like that."

In 2013, a series of devastating landslides at Kennecott Utah Copper LLC's Bingham Canyon mine caused about 165 million tons of debris to spill into the pit. The cleanup effort took years.

Lundin's spill by contrast saw about 700,000 tonnes of waste fall into the pit floor – information it disclosed in a conference call on Dec. 1. Still the rock slide occurred in an ore-rich area of the property where the company was actively mining. Furthermore, removing the waste isn't a straightforward matter of quickly clearing it out from the bottom. Due to safety issues, Lundin will take the more time-consuming approach of removing debris from the top down. While further rock slides slides are unlikely, Lundin could not completely rule out another event.

Before news of the rock slide hit, Lundin had been one of the best-performing mid-tier mining companies in Canada and among the highest-rated stocks in its peer group. In an October conference call, an analyst with Bank of America even congratulated management on a job well done, since acquiring Candelaria for $2-billion (U.S.) in 2014. Lundin's shares had roughly doubled in that time period.

Despite the setback at Candelaria and the steep fall in its share price, the event will have no impact on the company's ability to do mergers and acquisitions (M&A), said Mr. Conibear. It's no secret that Lundin is on the hunt for deals. Since selling $1.2-billion worth of copper assets late last year, analysts have been almost willing the company to put its sizable $1.5-billion cash pile to work. This year alone, Lundin looked at doing three disparate acquisitions, two in copper and one in zinc, but ultimately stayed on the sidelines. The company is known for its deliberate approach to M&A.

"Our business plan is to grow the company carefully," Mr. Conibear said.

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"Walk away when we need to. Look at everything that might fit."

Could the selloff in its own share price make Lundin itself vulnerable to a takeover?

"There's no signs of that now. But anything's possible." he said.

Lundin fended off a hostile takeover by Equinox Minerals Ltd. in 2011, at a time when copper prices were near a historic high. Barrick Gold Corp. pre-empted matters by buying Equinox that same year.

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