TSX-listed Nevsun Resources has confirmed that a special committee would consider the C$1.4-billion offer from Lundin Mining – formally tabled on Thursday – and urged shareholders not to take any action before the board makes a formal recommendation.

Nevsun, which on Thursday also released its second-quarter results, said that the offer ignored the fundamental value of the business and that it also did not take into account the recent improvements at the Bisha mine, in Eritrea, and new developments at Timok, in Serbia.

“These achievements have set the stage for further value enhancement, and attracted the attention of several strategic parties that have expressed an interest in participating in the company's continued development,” Nevsun stated.

The offer will remain open for a minimum of 105 days, allowing Nevsun shareholders until November 9, to respond.

Meanwhile, Nevsun reported that it produced 23 300 t of zinc in concentrate and 3 900 t of copper in concentrate in the second quarter, which is less than the 32 500 t of zinc and 4 100 t of copper produced in the preceding quarter. It is also below the prior year quarter’s 26 100 t of zinc in concentrate, but higher than the 1 600 t of copper in concentrate of that quarter.

"We improved metallurgical performance at Bisha in the second quarter with the implementation of the new reagent scheme. Production volumes were down principally due to the processing of lower grade material, however we expect to revert to processing higher grade material through the balance of 2018. Most importantly, we were able to convert a portion of our extensive resources to reserves in a capital efficient, economically attractive mine life extension, which is expected to extend Bisha cash flows, reducing Timok funding requirements," said CEO Peter Kukielski.

At Timok, the company has declared an initial resource for the Lower zone, which confirmed the project as one of the largest copper porphyry discoveries in recent years. The miner will complete the trade off study on the ramp scenario for the Upper zone during the third quarter.

Kukielski added that Nevsun continued to engage with potential strategic partners, which could invest in Nevsun and potentially bring complementary technical or other capabilities required for successful execution of the Serbian project.