JOHANNESBURG (miningweekly.com) – TSX-listed Copper Mountain Mining Corporation (CMMC) on Monday announced that it would buy ASX-listed Altona Mining for A$93-million, giving the company access to the undeveloped Cloncurry copper project, in Queensland.

The project holds a measured and indicated mineral resource containing more than two-billion pounds of copper and an inferred resource of 1.6-billion pounds of copper.

The companies said in a joint statement that the combination of CMMC and Altona could result in a mid-sized copper company, with a production profile of about 73 000 t/y of copper.

CMMC's principal asset is the 75%-owned large openpit Copper Mountain mine, near Princeton, in southern British Columbia, which is forecast to produce 34 000 t to 38 500 t of copper this year.

CMMC CEO Jim O’Rourke said in a statement that the company had been evaluating opportunities to achieve a step-change in copper production for some time.

“Cloncurry exemplifies the criteria of low-risk, near-term and high-quality for which we have been seeking.”

Altona MD Dr Alistair Cowden added the company was “delighted” to join CMMC to form a new high growth copper producer. “We are excited to bring CMMC's depth of experience in constructing and operating a large scale openpit copper mine to bear upon the Cloncurry copper project. Altona's shareholders will receive a premium and will also gain immediate exposure to copper production just as copper prices have recovered and market shortfalls are predicted over the near term.”

Each share of Altona will be exchanged for 0.0974 of either a Chess depositary interest of CMMC, which will trade on the ASX, or, if elected, a CMMC common share, which trades on the TSX.

The total consideration represents A$0.17 a share, a 41.7% premium to A$0.12 apiece. The acquisition will be effected pursuant to a merger implementation deed (MID) under which Altona has agreed to propose the scheme that will allow Altona to become a wholly-owned subsidiary of CMMC.

The parties have agreed that unless the MID is terminated, Altona will not solicit any competing proposal or participate in any discussions or negotiations in relation to any competing proposal unless failure to do so would involve a breach of the fiduciary duties of its directors. Altona and CMMC have agreed to pay a break fee of A$0.9-million in certain circumstances leading to the scheme not proceeding.

In July, Altona abandoned a joint venture deal with Sichuan Railway Investment Group over the Cloncurry project, after the Chinese group failed to secure regulatory approval for the transaction that would have seen the State-owned company buy two-thirds of the copper deposit.