Lundin offers USD 1.4 billion for Cukaru Peki site near Bor, Canadian Nevsun finds sum insufficient

The Swedish mining company Lundin has offered USD 1.4 billion for the Cukaru Peki site near Bor, one of the richest copper and gold sites in the world, to Canada's Nevsun, the owner of exploration rights on the site. However, the management of Nevsun has recommended to its shareholders not to accept the offer, Blic writes.

Prior to making this offer, Lundin and the Canadian company Euro Sun offered USD 1.5 billion for exploration rights at Cukaru Peki and the Bisha zinc mine in Eritrea, but that offer was declined as well.

– Following our attempts to constructively engage Nevsun, we have determined that the best course now is to make an all cash offer directly to Nevsun shareholders. We believe that the proposed Nevsun acquisition consideration is full and fair value – said Paul Conibear, President and CEO of Lundin Mining.

Peter Kukielski, Nevsun's President and CEO, however, recommended that shareholders take no action in response to Lundin's announcement.

– No formal offer has yet been made. Explorations have shown that the upper and the lower zone of Cukaru Peki contain around 15 million tons of copper and around 370 tons of gold. Despite the progress we have made in enhancing Nevsun's value, this latest announcement from Lundin continues to ignore the fundamental value of Nevsun and its assets – Kukielski said.

If Lundin makes a formal offer on July 27, 2018, the special committee of independent Nevsun directors would consider it with its advisors before making a recommendation to Nevsun's Board of Directors and Nevsun's shareholders, who would have a minimum of 105 days to respond.

The value of the Cukaru Paki site has been estimated at around USD 100 billion, and Nevsun has recently obtained the permit from the Government of Serbia for the construction of a decline, the first step toward the opening of the mine.

Lundin has mines of copper, nickel and zinc in Chile, USA, Sweden and Portugal. They own a cobalt refinery in Finland.

Lundin Mining Toronto

Nevsun Resources Ltd.

Lundin

Nevsun

Cukaru Peki

Bor

Cukaru Peki site near Bor

copper

gold

copper site

gold site

copper and gold site

Lundin offer

Paul Conibear

Peter Kukielski