Canadian Mining Company Buys Glencore Assets in Bolivia

The Canadian company Santacruz Silver Mining purchased all of Glencore’s shares in several Bolivian silver mining companies. The terms of the deal were not disclosed.

DuMoulin Black LLP (Vancouver) and Dentons Guevara & Gutierrez (Santa Cruz de la Sierra and La Paz), the latter with tax, labor, mining, competition, and contracts teams, assisted the buyer in signing the definitive share purchase agreement. Maxit Capital acted as its financial advisor in the transaction, which was announced on October 13.

McCarthy Tétrault – Canada could not confirm its involvement in this deal on behalf of the seller, the Swiss-based commodities producer, and trader. A Bolivian law firm also acted for Glencore but preferred to keep a low profile.

Guevara & Gutiérrez commented that the transaction included complex legal due diligence structures, mergers, and acquisitions, cross-border financing, and guarantees, payments subject to adjustments, as well as the granting to Glencore of a 1.5% net smelter return royalty on assets.

Read more on the subject and find the most important business news in the world with the Born2Invest mobile app.

The closing of the deal is projected for this quarter

Santacruz Silver indicated that the agreement includes a 45% interest in a portfolio of silver assets, such as Bolívar and Porco, through a joint venture with the state-owned Corporación Minera de Bolivia (COMIBOL) under the name JV Illapa; a 100% interest in the Sinchi Wayra business, which includes the Caballo Blanco mining complex that integrates the Colquechaquita, Tres Amigos and Reserva mines and is located in Potosí, in the southern part of the country, as well as the Sorocaya project.

They are also part of the San Lucas Ore Sourcing & Trading Business, as well as certain properties and related assets. In total, there are five mines producing silver, lead, and zinc; two exploration projects; three milling plants; a trading company; and two thermal and hydroelectric power plants.

For the buyer, this transaction represents the “creation of a major mid-tier silver producer focused on the Americas, with significant additional leverage in the zinc market”.

The closing of the deal is projected for this quarter, once certain definitive agreements are entered into with Glencore regarding the amount of the deferred consideration, royalty, and certain purchase rights in favor of Glencore, which receives approval from the Canadian TSX Venture Exchange, among other closing conditions.

Santacruz operates with a focus on Mexico, where it has one silver production project (Zimapan) and two exploration properties (La Pechuga and Santa Gorgonia).

Glencore has been in a legal dispute against Bolivia since 2016 over the expropriation of its investment in Compañía Minera Colquiri, with the right to exploit the homonymous tin mine, the second largest in the country and an important source of zinc. The claim before the Permanent Court of Arbitration includes a non-productive antimony smelter and the loss of 161 tons of tin concentrates that the company had in storage.

__

(Featured image by tashinamgyal via Pixabay)

DISCLAIMER: This article was written by a third party contributor and does not reflect the opinion of Born2Invest, its management, staff or its associates. Please review our disclaimer for more information.

This article may include forward-looking statements. These forward-looking statements generally are identified by the words “believe,” “project,” “estimate,” “become,” “plan,” “will,” and similar expressions. These forward-looking statements involve known and unknown risks as well as uncertainties, including those discussed in the following cautionary statements and elsewhere in this article and on this site. Although the Company may believe that its expectations are based on reasonable assumptions, the actual results that the Company may achieve may differ materially from any forward-looking statements, which reflect the opinions of the management of the Company only as of the date hereof. Additionally, please make sure to read these important disclosures.

First published in LexLatin, a third-party contributor translated and adapted the article from the original. In case of discrepancy, the original will prevail.

Although we made reasonable efforts to provide accurate translations, some parts may be incorrect. Born2Invest assumes no responsibility for errors, omissions or ambiguities in the translations provided on this website. Any person or entity relying on translated content does so at their own risk. Born2Invest is not responsible for losses caused by such reliance on the accuracy or reliability of translated information. If you wish to report an error or inaccuracy in the translation, we encourage you to contact us.