(TSX:CIA; ASX:CIA) is taking advantage of the commodities crash to snatch the shuttered Bloom Lake iron ore mine for a fraction of its previous purchase price.
Champion recently agreed to buy the mine, related rail and mineral assets in Quebec, from creditors for $10.5 million in cash, as iron ore prices sink below US$40 per tonne on the back of oversupply and slumping Chinese demand. The company will also assume environmental obligations, including $41.7 million in reclamation liabilities, and the replacement of $1.1 million of bonds.
Champion chair and CEO Michael O’Keeffe described Bloom Lake as an “exceptional opportunity” and noted that the tough market conditions allowed it to negotiate a competitive bid.
It was roughly four-and-a-half years ago, Cliffs Natural Resources
(NYSE:CLF) paid $4.9 billion to pick up Bloom Lake as part of its pricey acquisition of Consolidated Thompson Iron Mines.
Read the complete article at NorthernMiner.com/news/champion-iron