2nd Oct 2013 08:24
LONDON (Alliance News) - Hochschild Mining PLC Wednesday said its beginning talks on a binding deal to acquire the remaining 40% stake in the Pallancata mine and Inmaculada project in Peru for roughly USD280 million.
The precious metals exploration and development company, operating in South America, said the remaining interest in the sites are owned by International Mineral Corporation, or IMZ, and the transaction would be made by way of a court-approved Plan of Arrangement.
After the deal, Hochschild would own 100% of the two sites.
As part of the deal, each IMZ shareholder, other than Hochschild or its affiliates, would receive a cash payment of USD2.38 per share, representing a cash consideration of USD271 million.
The company also said it has commenced a financing deal and raised commitments for a USD340 million acquisition bridge financing facility while it has set up an equity placing for institutional investors of between 4.99% and 9.99% of Hochschild's share capital, representing between USD48-96 million.
The acquisition is expected to complete by the end of the fourth quarter 2013 as long as there are no unexpected delays.
On September 23, Citigroup raised Hochschild Mining's price target to 145 pence from 132 pence and UBS also raised the company's price target to 225 pence from 215 pence on the same day.
Hochschild shares were down 4.4% to 166.80 pence in early trading Monday.
By Tom McIvor; [email protected]; @TomMcIvor1
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