Peru’s Congress removes energy and mines minister amid sector protests
Romulo Mucho was removed from his post on Tuesday amid protests from small-scale miners in the Andean nation.
Pallancata mine and the Inmaculada project.
Latin American-focused precious metals firm Hochschild Mining (LON:HOCM) said Wednesday it would buy out its minority partner in two Peruvian silver mines, a transaction valued in about $360 million to $390 million, depending how a spin-off company from the deal is valued.
The Lima-based miner, which currently has a 60% stake in the Peruvian Pallancata mine and the Inmaculda gold-silver project, it is acquiring Canada-listed International Minerals (TSX:IMXZ) in order to get a hold of its 40% interest in the jointly-owned assets.
The company will issue between $48m and $96m of shares to contribute towards funding the acquisition, as it still needs to spend $230m to develop Inmaculada.
Hochschild CEO Ignacio Bustamante said those two projects are the company’s biggest cash flow generator and most exciting growth project, respectively.
“This transaction represents an important opportunity to increase our exposure to our southern Peru cluster, reduce our overall operating cost position and to potentially enhance our cash flow generating potential at no additional ongoing administrative cost,” he said in a statement.
“The [International Minerals] board believes that the transaction is a “win-win” situation for both companies and their respective shareholders,” the Arizona-based miner CEO, Stephen Kay, added.
Hochschild also has projects in Argentina and Chile.
