Luoyang Molybdenum Announces Major Asset Transfer and Divestment

Luoyang Molybdenum Announces Major Asset Transfer and Divestment

Strategic Shift in Operations with $756 Million Transfer and Australian Mine Divestment

Luoyang Molybdenum, a prominent player in the mining industry, has announced a significant transaction set for December 5. The company plans to transfer its entire equity interest in CMOC Mining and CMOC Metals to Evolution Mining for a total consideration of $756 million and $1, respectively. This move is expected to bring a one-time net accounting benefit of over $200 million to Luoyang Molybdenum upon completion.

Asset Optimization and Strategic Reviews

This decision comes as part of Luoyang Molybdenum’s ongoing strategic reviews and analytical evaluations of its assets and operations. The objective is to identify opportunities for optimizing its portfolio to enhance value creation. A key focus of this strategy is the divestment of the Northparkes Mines copper-gold mine in Australia (NPM Copper-Gold), which has been contributing a decreasing proportion of the Group’s production and net profit.

Rationale Behind the Divestment

The management and the Board of Luoyang Molybdenum believe that the sale of the NPM Mine aligns with the Group’s development priorities. This divestment is expected to lower the Group’s gearing ratio and improve the efficiency of capital allocation. By shedding this asset, which has become increasingly marginal in terms of its contribution to the Group, Luoyang Molybdenum aims to streamline its operations and focus on more profitable ventures.

This development is a strategic move in the mining sector, indicating Luoyang Molybdenum’s focus on refining its asset base and optimizing its portfolio for future growth and profitability. icon

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