08/07/2014 - 10:24

Altona sells Finnish operations for $US95m

08/07/2014 - 10:24

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Perth-based Altona Mining has agreed to sell all of its Finnish operations and most of its exploration assets to Swedish miner Boliden Mineral AB for about $US95 million.

Altona sells Finnish operations for $US95m
Site works at Altona's Hautalampi project near Outokumpu.

Perth-based Altona Mining has agreed to sell all of its Finnish operations and most of its exploration assets to Swedish miner Boliden Mineral AB for about $US95 million.

After the transaction, Altona will retain its Hautalampi project near Outokumpu in Finland, but it has granted Boliden an option to either mine the deposit in exchange for a 2 per cent royalty payment or purchase the project outright for $US3 million. 

Altona will also retain its Sarkiniemi mine.

The company expects to have about $125 million in cash, and intends to make an $80 million payment to shareholders for 15 cents per share, which is just below the company’s volume weighted average 16 cents per share price. 

Altona hasn’t decided whether the payment would be comprised of a capital reduction, a buy back of shares, or a dividend.

Altona said that, if the transaction and capital management initiatives were made, it would retain about $40 million in cash, as well as full ownership of its Little Eva project at Cloncurry in Queensland and an interest in the adjacent Chinalco Yunnan Roseby exploration joint venture. 

However the company said it would review the value of its Little Eva project, which, depending on the result, may lead to either a partnership with another company or a sale of the asset. 

Credit Suisse is acting as financial adviser to Altona for the transaction, with Gilbert + Tobin as the company’s legal adviser. 

Altona shares jumped by 29.4 per cent to 22 cents per share at 10:15am. 

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