Skip to main content
Canada’s most-awarded newsroom for a reason
Enjoy unlimited digital access
$1.99
per week
for 24 weeks
Canada’s most-awarded newsroom for a reason
$1.99
per week
for 24 weeks
// //

Lundin Mining Corp. has struck a $1.4-billion stock-swap deal to acquire Tenke Mining Corp. and create a leading intermediate base-metals company with a global portfolio of assets.

Vancouver-based Tenke holds an interest in the Tenke Fungurume copper and cobalt deposits under development in the Democratic Republic of Congo, as well as extensive copper and gold exploration properties in South America.

Just a week ago, Lundin - a Canadian-Swedish company - made an $865-million takeover bid for Rio Narcea Gold Mines Ltd., saying it could bump up revenue at the Aguablanca nickel mine in Spain.

Story continues below advertisement

Pending approval by two-third of Tenke's stockholders, each Tenke common share would be exchanged for 1.73 Lundin Mining common shares, the companies said Wednesday.

The deal represents a 31.2 per cent premium over Tenke's 20-day average trading price as of April 10, based on Lundin's average trading price of $13.51 a share, the firms said in a release. Tenke shares closed Tuesday at $19.53 on the Toronto stock market.

As part of the takeover deal, Tenke would convey its South American assets and $5-million (U.S.) cash to a new subsidiary whose shares would be distributed to Tenke shareholders.

Lundin Mining plans to hold a special shareholders meeting in June to approve the issue of its common shares, requiring support by a 50.1 per cent majority.

The deal already has the support of Lundin family interests, as well as directors and senior officers of both Lundin Mining and Tenke.

Paul Conibear, president and CEO of Tenke Mining, would join Lundin Mining in a senior management position responsible for development of the Tenke Fungurume project. He will also be president and CEO of the new company that would hold Tenke's South American assets.

"The Tenke Fungurume project will add enormous value to the company and both Tenke and Lundin Mining shareholders," Lundin Mining CEO Karl-Axel Waplan said in a release.

Story continues below advertisement

"The mineralization is so extensive, with multiple high-grade copper/cobalt deposits throughout a 1,500-square-kilometre area that it is virtually an entire mining district unto itself."

Conibear said combining Tenke's assets into Lundin Mining "will leverage the financial and operating depth of Lundin Mining into the Tenke Fungurume partnership to further strengthen the project."

Tenke Mining is a Canadian mineral resource company with development projects and exploration activities in the Democratic Republic of Congo, Argentina and Chile.

Tenke holds a 24.75 per cent interest in the Tenke Fungurume deposits. Operating partner Freeport-McMoRan Copper & Gold Inc., formerly Phelps Dodge Corp., holds a 57.75 per cent interest and La Generale des Carrieres et des Mines, the Congo state mining company, holds the remaining 17.5 per cent.

Lundin Mining owns four operating mines: Neves-Corvo in Portugal, the Zinkgruvan and Storliden mines in Sweden, and the Galmoy mine in Ireland. A fifth mine under development, the Aljustrel mine in Portugal, will be brought into production in the third quarter of 2007.

Lundin also holds a 49 per cent stake in one of the world's largest zinc projects - Ozernoe, in the Republic of Buryatia in the Russian Federation.

Report an error
Tickers mentioned in this story
Due to technical reasons, we have temporarily removed commenting from our articles. We hope to have this fixed soon. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to feedback@globeandmail.com. If you want to write a letter to the editor, please forward to letters@globeandmail.com.

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff.

We aim to create a safe and valuable space for discussion and debate. That means:

  • Treat others as you wish to be treated
  • Criticize ideas, not people
  • Stay on topic
  • Avoid the use of toxic and offensive language
  • Flag bad behaviour

If you do not see your comment posted immediately, it is being reviewed by the moderation team and may appear shortly, generally within an hour.

We aim to have all comments reviewed in a timely manner.

Comments that violate our community guidelines will not be posted.

UPDATED: Read our community guidelines here

Discussion loading ...

To view this site properly, enable cookies in your browser. Read our privacy policy to learn more.
How to enable cookies