Copper deal makes Sandfire the miner of Seville – by Peter Ker (Australian Financial Review – September 23, 2021)

Australian miner Sandfire Resources will spend more than twice its market capitalisation to solve its growth problems, unveiling a $2.57 billion Spanish mine acquisition that investors described as “transformational” and “a game changer”.

Sandfire will take on new debt and ask investors to buy $1.2 billion of new shares to fund the $US1.86 billion ($2.57 billion) acquisition of Spain’s Minas D’Aguas Tenidas (MATSA) mine, which is located north-west of Seville.

Acquisition of the copper, zinc, lead and silver mine is of great significance for Sandfire, both in the context of its $1.1 billion market capitalisation and in terms of solving investors’ biggest concern with the company.

Sandfire’s flagship Degrussa copper mine in Western Australia will cease production in 2023, and while the company has started building a smaller copper mine in Botswana, there remains a chance that Degrussa may cease production before revenues start flowing from Botswana.

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