Hochschild Mining buys out Peruvian assets
LONDON (Reuters) - Latin American precious metals firm Hochschild Mining (HOCM.L) said it planned to raise up to $96 million to help it buy the remaining 40 percent stakes in its Peruvian assets for up to $280 million.
The Lima-based company, which currently holds a 60 percent interest in the Peruvian Pallancata mine and the Inmaculda project assets, said it would acquire International Minerals IMZ.TO primarily for its 40 percent interest in the jointly-owned assets.
The acquisition is expected to be earnings enhancing in the first full year of ownership. Shares in Hochschild were down 2.7 percent in early trading.
Hochschild said it planned to raise between $48-$96 million in an equity placing to partially fund the acquisition and noted the company is still on track to produce 20 million attributable silver equivalent ounces in 2013.
Hochschild has projects in Argentina and Chile but its south Peruvian mines provide the bulk of its production.
"We are excited to be announcing today a strategic milestone...by consolidating ownership in Pallancata, currently our biggest cash flow generator and Inmaculada, our most exciting growth project," said the company's chief executive Ignacio Bustamante.
The company said its other focus of growth, the Crespo project, would be deferred as it focuses its capex spending on the Inmaculda Project.
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