Victorian based Oz Minerals has spent $100 million to acquire a 19 per cent stake in Sandfire Resources, whose share price rocketed on the discovery of a gold-copper deposit near Meekathara last year.
Victorian based Oz Minerals has spent $100 million to acquire a 19 per cent stake in Sandfire Resources, whose share price rocketed on the discovery of a gold-copper deposit near Meekathara last year.
Oz Minerals said the acquisition was a strategic investment which provided exposure to Sandfire's high quality Doolgunna project.
Oz Minerals said the stake was completed with the majority of the 25.8 million Sandfire shares purchased from a number of high net worth/institutional investors and the balance from on-market purchases.
The company has requested a seat on Sandfire's board given its large stake.
OZ Minerals' managing director Terry Burgess said, "While the Doolgunna project is still at a relatively early stage, we have been impressed by the work undertaken by the Sandfire team and we hope to be able to work constructively with them in maximising the full value of this asset.
"We are particularly excited by the exploration potential of the project. Doolgunna appears to represent the discovery of a new high grade copper deposit with considerable upside yet to be realized," he said.
Head of business development for OZ Minerals, Richard Hedstrom added, "Whilst we will not be rushed into making important investment decisions for our stakeholders, our significant cash balance does give us the ability to move quickly on opportunities, such as the Sandfire equity stake, as and when they arise."
"Our intention is to maintain the interest in Sandfire at this level, at this stage. This acquisition is in line with the Company's previously stated strategy of investing in promising copper assets," he said.
Full company statement below:
OZ Minerals is pleased to announce that it has acquired approximately 25.8m shares
representing approximately 19% of Australian listed Sandfire Resources NL. This is
considered a strategic investment which provides exposure to Sandfire's high quality
Doolgunna project located in Western Australia.
The acquisition of the stake was completed today with the majority purchased from a
small number of high net worth / institutional investors and the balance from on-market
purchases. The total consideration for the purchase was approximately A$100 million.
Commenting on the transaction, OZ Minerals' Managing Director Terry Burgess said,
"While the Doolgunna project is still at a relatively early stage, we have been impressed by the work undertaken by the Sandfire team and we hope to be able to work constructively with them in maximising the full value of this asset. Given the size of the stake, OZ Minerals is formally requesting a seat on the Sandfire Board of Directors. We are particularly excited by the exploration potential of the project. Doolgunna appears to
represent the discovery of a new high grade copper deposit with considerable upside yet
to be realised."
Head of Business Development for OZ Minerals, Richard Hedstrom added, "Whilst we will not be rushed into making important investment decisions for our stakeholders, our
significant cash balance does give us the ability to move quickly on opportunities, such as
the Sandfire equity stake, as and when they arise. Our intention is to maintain the interest
in Sandfire at this level, at this stage. This acquisition is in line with the Company's
previously stated strategy of investing in promising copper assets."
The Sandfire equity stake forms part of the growing portfolio of assets within OZ Minerals, centred on the Prominent Hill copper-gold mine in South Australia. Supplementing this is an extensive exploration effort around the Prominent Hill copper mine and in the broader Prominent Hill region, as well as exploration interests in Cambodia, Australia and Mexico.
The OZ Minerals stake in Sandfire complements other such strategic equity stakes,
including IMX and Toro, a complete list of which is on the OZ Minerals web site.
OZ Minerals was advised by Argonaut.
