HomeBase MetalsFirst Quantum buys Kiwara plc

First Quantum buys Kiwara plc

Deep drilling at
Kiwara’s Kalumbila
project in Zambia
London, England — MININGREVIEW.COM — 23 November 2009 – Listed on the Toronto and London Stock Exchanges, First Quantum Minerals Limited “’ a growing mining and metals company which focuses on Africa “’ has agreed to buy Kiwara Plc in a cash and share deal worth US$260 million (R1.9 billion) to expand its copper mining operations in Zambia.

Reuters reports that London shares in Kiwara “’ which owns the Kalumbila copper project in Zambia “’ jumped 22.6% to 65 pence after the agreed deal had been announced. The shares had nearly tripled so far this year before today’s news as copper prices recovered.

"Given that First Quantum has an unrivalled track record in development, and has its flagship mine nearby, we think the market may give them the benefit of the doubt,” Liberum Capital said in a note here.

First Quantum said it had received undertakings from shareholders representing 76% of Kiwara shares to accept the offer, which has also been recommended by Kiwara’s board.

“We believe our many years of successful operations in the Copperbelt and Zambia in particular, will be beneficial in the development and eventual operation of the new assets,” First Quantum chief executive Philip Pascall said.

In terms of the deal, Kiwara shareholders will receive 0.0085 First Quantum shares and 37.5 pence for every Kiwara share held. The implied value per Kiwara share is 75 pence “’ a 41.5% premium to the closing price of Kiwara on Friday.

“Kiwara has recognised that the Kalumbila project, and indeed the licence area in general, has potential well in excess of our current resource capability,” Kiwara chairman Colin Bird said.

Kiwara is listed in Johannesburg.