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BHP (NYSE:BHP) and Lundin Mining (OTCPK:LUNMF) said late Monday they agreed to jointly acquire Canadian exploration company Filo (OTCQX:FLMMF) for ~C$4.1B (US$2.96B), or ~C$33/share, in a move to boost their copper resources.
BHP (BHP) and Lundin (OTCPK:LUNMF) said they would pay ~C$33/share (US$24) for Filo (OTCQX:FLMMF), a 12% premium to the company’s closing price in Toronto on Monday; the companies said Filo shareholders can opt for cash, Lundin shares or a combination of both.
BHP (BHP) and Lundin (OTCPK:LUNMF) will form a 50-50 joint venture to hold both the Filo del Sol copper-gold-silver project near the Argentina-Chile border and the nearby Josemaria copper-gold project that is owned by Lundin; BHP will pay ~US$690M for half of that project.
“This transaction aligns with BHP’s strategy to acquire attractive early-stage copper projects and enter into strategic partnerships with parties where complementary skills and experience can deliver long-term economic and social value,” BHP (BHP) CEO Mike Henry said.
BHP (BHP) has been “looking to bulk up their copper outlook,” CLSA analyst Baden Moore told Reuters. “The deal is demonstrating to BHP’s shareholders that BHP has other strategies to build their copper exposure, although I don’t think it means they have definitively walked away from Anglo,” referring to the attempt earlier this year to buy Anglo American with a ~US$50B takeover bid that was rebuffed.
