Zijin buys Freeport's assets for USD 390 million – Cukaru Peki copper and gold mine to be 100% owned by Chinese company

Zijin Mining, one of China’s biggest gold producers, said on Monday it would buy partner Freeport McMoran's copper-gold assets in Serbia for up to USD 390 million, substantially boosting its resources of both metals, Reuters reports.

Zijin already has a 100% interest in the upper zone through its Nevsun acquisition and holds 60.4% of the lower zone. Freeport owns the rest of the lower zone but its holding was due to rise to 54% on completion of a feasibility study.

The Chinese company expects the transaction to be completed no later than February 29, 2020.

Zijin will pay Freeport an initial USD 240 million for its stake in the lower zone of the Timok copper-gold mine, plus 0.4% of the net sales proceeds once production begins, up to an aggregate maximum amount of USD 150 million, according to a filing to the Hong Kong stock exchange.

Reuters writes that the move continues a recent acquisition spree for Zijin and strengthens its foothold in the Balkans, having entered Serbia when it took over local copper producer RTB Bor in 2018, before completing the purchase of Nevsun Resources, which also has interests in Serbia, for USD 1.4 billion this year.

The company said the acquisition would lift its total controlled copper resources by 7.72 million tons, or 15.6%, to 57.24 million tons on an equity basis, while its gold resources would rise by 161 tons, or 9.3%, to 1,889 tons.

Production from the upper zone is expected to begin in 2021, it added.