China's Zijin Mining Group said on November 4 it has signed an agreement to buy Freeport McMoran's copper and gold assets in Serbia for up to $390mn.
The Timok copper and gold project consists of the Cukaru Peki Upper Zone and Lower Zone. Zijin already owns 100% of the Cukaru Peki Upper Zone plus a 60.4% stake in the Cukaru Peki Lower Zone, while Freeport McMoran owns the remaining stake.
According to the agreement, Zijin will pay $240mn for 72% class B shares of Freeport McMoran’s unit CuAu International Holdings and 0.4% of the net proceeds from the sales of all products annually, up to an aggregate maximum amount of $150mn.
“After completion of the transaction, the company will own 100% interests in the resources of both the Upper Zone and the Lower Zone of the Timok copper-gold mine,” Zijin said in the press release on its website.
The transaction would lift the total controlled copper resources of Zijin by 7.72mn tonnes to 57.24mn tonnes on an equity basis, while its gold resources would increase by 161 tonnes to 1,889 tonnes.
Zijin will also acquire the interests of Freeport McMoran in five exploration licenses in the area surrounding the Timok copper-gold mine, which are currently held by Zijin-Freeport joint venture Rakita Exploration.
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