July 30, 2024 (Globalinvestorideas.com Newswire) Globalinvestorideas.com, a go-to platform for big investing ideas, including mining stocks reports on trading for Filo Corp. (TSX: FIL) (Nasdaq First North Growth Market: FIL) (OTCQX: FLMMF).
The stock makes the TSX top volume leader and is a notable percentage gainer on big news in the mining industry, that has investors paying attention to the sector.
The stock is trading at $31.98, up $2.56 , gaining 8.70% on volume of over 5.2 Million shares at the time of this report .
Filo is a Canadian exploration and development company focused on advancing its 100% owned Filo del Sol copper-gold-silver deposit located in San Juan Province, Argentina and adjacent Region III, Chile.
Yesterday at the close Filo announced it has entered into a binding agreement (the “Arrangement Agreement”) with BHP and Lundin Mining Corporation (“Lundin Mining”, together with BHP, the “Purchaser Parties”) (TSX: LUN) (OMX: LUMI) whereby the Purchaser Parties will acquire all of the outstanding common shares of Filo that they do not already own (the “Filo Shares”) through a plan of arrangement (the “Transaction”). PDF Version
Concurrent with the Transaction, BHP and Lundin Mining will form a Canadian joint venture (“JV”) into which the Filo del Sol copper-gold-silver project and the Josemaria copper-gold project (currently 100% owned by Lundin Mining and located in the San Juan Province of Argentina in the same region as Filo del Sol) will be contributed, allowing for the joint development of the Vicuña district. BHP and Lundin Mining will each own a 50% interest in the JV following the Transaction.
Highlights of the deal
Crystalizes immediate value for Filo shareholders and delivers a clear and credible path to developing Filo del Sol to its full potential, backed by two of the world’s leading copper miners;
Consolidation of two key assets in the Vicuña district by the JV creates a market-leading operational footprint in the district and offers:
Strong balance sheet capacity to fund future project development;
Potential to capture synergies and operational efficiencies; and
The ability for Filo del Sol to benefit from recently passed legislation in Argentina benefiting projects entering development;
Filo shareholders that receive Lundin Mining shares will maintain upside exposure to the JV, while also benefiting from:
Jurisdictional and project risk diversification in a company with diversified asset portfolio with long-life assets operating globally;
Exposure to strong and increasing cash flow generation and dividends; and
Enhanced market profile with greater share liquidity.
Under the terms of the Transaction, Filo shareholders, excluding BHP and Lundin Mining, will receive total consideration of approximately C$4.1 billion, representing C$33.00 per Filo Share, based on the 5-day volume weighted average price of Lundin Mining shares as of today’s close on the TSX. Filo shareholders will be able to elect to receive the consideration as either (i) C$33.00 in cash per Filo Share or (ii) 2.3578 Lundin Mining shares per Filo Share, or some combination of cash and shares, subject to proration. The total cash consideration will be subject to maximum cash consideration of approximately C$2,767 million (representing 68.2% of the aggregate total consideration). The total share consideration will be subject to maximum share consideration of 92.1 million Lundin Mining Shares (representing 31.8% of the aggregate total consideration). Shareholders that do not make an election will be deemed to have elected to receive cash consideration. The consideration represents a premium of 32.2% and 25.8% to the unaffected 30-day volume weighted average price and the unaffected closing price, respectively, of the Filo Shares on the TSX for the period ending July 11, 2024, being the day before press speculation of a transaction. On closing of the Transaction, Filo shareholders are expected to own approximately 11% of Lundin Mining, on a fully diluted basis.
Jamie Beck, President, CEO and Director of Filo said, “I’m very happy to announce this transaction today, which delivers compelling value to Filo’s shareholders. The Transaction delivers a 17.4% premium to the unaffected all time high for Filo’s shareholders while offering exposure to the future development of Filo del Sol in addition to Lundin Mining’s high-quality operating portfolio. The total consideration represents approximately C$924 million in value above Filo’s unaffected market capitalization on July 11, 2024.”
Mr. Beck continued, “Our copper-gold-silver exploration success at Filo has been unmatched since spinning the Company out in 2016, and now is the right moment to hand the project off to its next stewards to maximize the potential of this remarkable discovery. Since their initial investment in Filo in 2022, BHP has proven to be a fantastic partner who has shared in our vision of the potential at Filo del Sol. That vision began in 2002 when this property was first acquired by the Lundin Family who had the conviction and perseverance to advance the project over the next two decades – characteristics I’m sure will continue under Lundin Mining’s ownership. It’s not easy pulling together three parties to an agreement like this. I’m excited to combine Filo del Sol along with Josemaria into the JV, consolidating two key assets in the Vicuña district in this joint venture, whose partners have the financial strength, technical expertise, and operational experience to advance Filo del Sol at the pace and scale it deserves while committing to the highest ESG practices globally.”
Recent news
https://ca.finance.yahoo.com/news/bhp-lundin-mining-acquire-filo-233000098.html
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