Yunnan Tin buys two iron ore mines for $155m
Yunnan Tin, the largest tin producer in China, has agreed to buy two iron ore mines in Xinjiang, in the west of the country for HKD1.2 billion ($155 million).
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The Hong Kong-listed miner will pay HKD690 million ($89 million) in cash, 1.05 billion new shares and HKD300 million ($39 million) convertible bonds to Mega Marks Ltd, owner of the mine, Yunnan Tin said on Thursday December 12.
The company’s shares in Hong Kong, halted since February 2013, resumed trading in Hong Kong today.
The iron ore sales revenue from the two target iron ore mines stood at HKD364.2 million ($47 million) in 2012, compared with HKD215.8 million ($28 million) a year earlier, according to the announcement.
“The acquisition represents a valuable investment opportunity for the group, having considered the amount of proved and probable reserves as well as indicated resources at the target mines,” Yunnan Tin said.
Mega Marks commenced production at the two mines in 2009, achieving a run-of-mine output of 2.54 million tonnes by the end of 2011.
Its ore 2-million tpy ore processing plant also came into operation in 2009. A new line with 1.5 million tpy processing capacity is scheduled to come on stream in 2015.