October 15, 2018 / 10:24 PM / in a month

CORRECTED-UPDATE 1-Australia's BHP raises stake in promising Ecuador copper project

(Corrects third paragraph to say offer at a 28 percent premium, not 36.6 percent)

Oct 16 (Reuters) - The world’s biggest miner BHP on Tuesday upped its share in SolGold Plc, bolstering its position against top shareholder Newcrest Mining as it eyes SolGold’s promising Cascabel copper-gold project in Ecuador.

Under the deal, SolGold will issue a 100 million shares to the company, raising its stake to 11.2 percent from 6.0 percent.

BHP has agreed to pay 45 pence per SolGold share, which is at a 28 percent premium to the stock’s close on Monday.

Australian gold miner Newcrest Mining Ltd, is the top shareholder in SolGold, Cascabel’s majority owner and operator, with a 14.54 percent stake.

“This additional investment in SolGold strengthens our strategic position in the Cascabel copper exploration project,” BHP President Minerals Americas, Danny Malchuk said in a statement.

In common with other miners that have recovered from the price crash of 2015-16, BHP is seeking to grow its asset base and is keen on copper. The metal is expected to be in demand for use in renewable energy and electric vehicles, but new opportunities are scarce.

The Anglo-Australian miner also said that subject to certain exceptions, it will not acquire more shares in SolGold for a period of two years without SolGold’s consent.

BHP also has an anti-dilution rights period of two years, allowing to maintain its shareholding at 10 per cent.

Reporting by Devika Syamnath in Bengaluru

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