TORONTO – Hudbay Minerals has announced its intention to acquire all of the issued and outstanding common shares it does not already own of Vancouver's Augusta Resource Corp., a deal that values the smaller company at $540 million. Augusta's chief asset is the Rosemont copper-molybdenum-silver development project near Tucson, AZ.
Hudbay said in a release that Rosemont is a low cost, long life asset that will enhance Hudbay's position as a leading intermediate base metals producer. Hudbay has the technical and operational expertise as well as the financial capacity to develop and operate the mine to the benefit of all stakeholders. Acquisition of development stage assets in mining friendly jurisdictions is part of Hudbay's growth strategy.
As of July 2012, Rosemont has proven and probable reserves of 605,150 million tonnes grading 0.44 Cu, 0.015% Mo and 4.11 g/t Ag. Measured and indicated sulphide resources total 833.8 million tonnes at 0.41% Cu and oxide resources of 57.5 million tonnes at 0.17% Cu. Inferred resources are estimated at 125.7 million tonnes grading 0.40% Cu in the sulphide portion and 1.0 million tonnes grading 0.15% Cu in the oxide portion. At that time the property was estimated to contain 5.9 billion lb of copper and 194 million lb of molybdenum.
Details of the offer are available at Hudbay's website, HudbayMinerals.com.
The Augusta board will meet this week to consider Hudbay's offer.