Hudbay and a B.C.-based mining company have finalized a deal combining the two companies.
Hudbay and Copper Mountain Mining Corporation approved the deal June 13 through a pair of shareholder votes, with B.C.’s highest court approving the deal two days later. News of the two companies combining operations first came in April, but shareholders for both companies only voted last week to ratify the deal in a pair of special meetings - one for each company.
The final announcement for a merger came June 20, with Hudbay announcing the transaction was complete, making Copper Mountain a fully-owned subsidiary of Hudbay.
"Hudbay is pleased to announce that it has closed its previously announced court-approved plan of arrangement with Copper Mountain, pursuant to which Hudbay has acquired all of the issued and outstanding common shares of Copper Mountain effective as of today’s date," reads a Hudbay statement on the deal issued June 20.
“We estimate that this combination could unlock US$30 million per year in operating efficiencies and corporate synergies and it is accretive to Hudbay’s key per share metrics,” said Hudbay president and CEO Peter Kukielski when news of the deal was first announced in April.
Shareholders for both companies voted heavily in favour of the transaction last week - 99.8 per cent of all votes cast by Hudbay shareholders were in favour, while 93.4 per cent of votes cast by Copper Mountain shareholders approved of the move.
As part of the deal, Hudbay will acquire all common shares of Copper Mountain and have a pro forma ownership group of 76 per cent Hudbay shareholders and 24 per cent Copper Mountain shareholders. Both companies’ boards of directors had unanimously approved the transactions - the new Hudbay board will include two directors appointed from Copper Mountain.
Final court approval of the deal was received June 15 by the Supreme Court of British Columbia and the Toronto Stock Exchange has tentatively approved listing Hudbay common shares in connection with the buy.
Copper Mountain owns a 75 per cent interest in the Copper Mountain open pit mine in British Columbia, which produces about 100 million pounds of copper equivalent each year.
According to Hudbay and Copper Mountain, the deal will turn Hudbay into Canada’s third largest copper producer, behind Teck Resources and Vale and ahead of Taseko Mines - the deal will push Hudbay past Taseko, according to the company data.
