Metal Tiger PLC (AIM:MTR, OTC:MRTTF, FRA:EBRA, ASX:MTR) flagged the A$1.9bn (GBP1bn) acquisition agreed by 3.4%-owned Sandfire Resources Limited of the Minas De Aguas Tenidas (MATSA) mining complex in Spain and a A$1.25bn equity raising.
The transaction will immediately transform Sandfire into one of Australia’s largest copper focussed producers, Metal Tiger said, with an expected pro-forma production next year of 170-194,000 tonnes of copper equivalent at direct costs of US$0.4-0.5/lb at MATSA and US$1.0-1.1/lb at its DeGrussa mine.
MATSA comprises three underground mining operations feeding a 4.7mln-tonnes-per-year processing facility with modern infrastructure producing 100-120,000 tonnes per year of copper equivalent.
The deal provides Sandfire “exposure to a long-life and first-quartile low-cost operation, with ~12 years mine life based on Resources and significant life extension and exploration potential, and a successful track record of replacing and growing Resources and Reserves”, Metal Tiger said.
Metal Tiger is currently interested in 6,143,357 Sandfire shares representing approximately 3.4% of Sandfire’s issued share capital, with 2,842,667 of the Sandfire shares subject to an equity derivative financing arrangement with an investment bank.
Metal Tiger said it will update shareholders in due course about its intentions with regard to its rights under the equity offer and is “currently exploring several options”.