Glencore to sell Ernest Henry asset to Evolution for US$730m

[LONDON] London-listed miner Glencore has agreed to sell its Ernest Henry Mining copper-gold mine in Queensland to Australia-based Evolution Mining for US$729.60 million, the companies said on Wednesday.

The acquisition will double Evolution Mining's annual copper production from its earlier forecast to between 34 kilotonne (kt)-38 kt, driving all-in sustaining cost (ASIC) lower to about A$90 (S$89.10) - A$100 per ounce.

The deal, expected to close in January 2022, also includes an offtake agreement sealing the supply of 100 per cent of the copper produced at the mine to Glencore, the companies said in a separate announcement.

Evolution will make an upfront payment of A$800 million to the diversified miner and pay the remaining amount after a year of deal completion.

The company plans to fund the deal through available cash and a new share issuance of US$200 million.

The deal will see Evolution fully own and operate the Ernest Henry Mine in which it held a stake since November 2016 via a joint venture structure with Glencore.

REUTERS