Metals Acquisition Walks Away from $1 Billion Neves Corvo Mine, Plans $140 Million Capital Raise
Metals Acquisition, which was believed to have considered acquiring the $1 billion Neves Corvo copper and zinc mine in Portugal, has decided not to proceed. Instead, the company announced plans to raise $140 million to reduce debt and "pursue strategic inorganic growth opportunities."
Sources also indicated that South32 had looked at the Neves Corvo asset but is no longer interested. The mine, which is being marketed by BMO with price estimates of around $1 billion, is now in the final stages of its sale process, with interest primarily from offshore groups.
Lundin Mining acquired the Neves Corvo mine, located in the western part of the Iberian Pyrite Belt, in 2006 through a merger with EuroZinc Mining. The mine's zinc plant recently underwent an expansion, increasing its nameplate capacity to 2.5 million tonnes per annum. It is expected to produce between 30,000 and 35,000 tonnes of copper and 120,000 to 130,000 tonnes of zinc in 2024. The processing facility at Neves Corvo includes two plants—one for copper, capable of processing 2.8 million tonnes annually, and another for zinc, which can process both zinc and copper with a nameplate capacity of 2.5 million tonnes per annum.
Metals Acquisition, reportedly planning to change its name to MAC Copper, announced it would raise $140 million via a placement priced at $18 per CHESS depositary interest, representing a 13% discount to its last closing price on the ASX. The move comes as its stock rebounded to $20.70 on Tuesday, having dropped to about $15 last month from a 2024 high of approximately $22. This decline occurred even as copper prices rallied by 22% between August and September, driven by Chinese stimulus efforts, although prices have since started to fall.
The company stated that the proceeds from the placement would be used to optimize MAC's balance sheet and promptly repay mezzanine debt. Until then, the additional capital would provide flexibility to pursue growth opportunities.
"Upon settlement of the placement, MAC will be well-capitalized with a cash balance of $177 million in addition to its $25 million revolving credit facility," the company said. Metals Acquisition, which purchased the CSA Copper Mine from Glencore for $1.6 billion in 2023, is listed on both the Australian Securities Exchange and in the U.S.
The company remains on track to achieve its full-year 2024 copper production guidance, targeting the midpoint of 38,000 to 43,000 tonnes. Investment bank Barrenjoey is leading the capital raising, with Sternship Advisers as co-manager.
