In a continuance of M&A transactions today, it has been revealed that Filo Corp (TSX: FIL) is set to be acquired by BHP and Lundin Mining (TSX: LUN).
The transaction will see the two mining majors acquire all the stock of Filo, before forming a joint venture that will bring together Filo’s Filo del Sol copper-gold-silver project and that of Lundin Mining’s Josemaria copper-gold project, in an effort to develop the district. The two majors are set to equally own the joint venture at 50% ownership each.
Under the terms of the arrangement, Filo shareholders will receive $33.00 in compensation per share held, valuing the company as a whole at $4.5 billion. Consideration is to come in the form of either cash, or 2.78 shares of Lundin Mining per share held of Filo, at the election of shareholders, subject to proration. Consideration is said to be subject to a maximum of 92.1 million Lundin shares being issued.
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The sales figure amounts to a premium of 25.8% based on the most recent closing price of Filo.
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“Our copper-gold-silver exploration success at Filo has been unmatched since spinning the Company out in 2016, and now is the right moment to hand the project off to its next stewards to maximize the potential of this remarkable discovery. Since their initial investment in Filo in 2022, BHP has proven to be a fantastic partner who has shared in our vision of the potential at Filo del Sol. That vision began in 2002 when this property was first acquired by the Lundin Family who had the conviction and perseverance to advance the project over the next two decades – characteristics I’m sure will continue under Lundin Mining’s ownership,” commented Jamie Beck, CEO of Filo.
A concurrent private placement has been announced in conjunction with the buyout, which will see Filo raise gross proceeds of $115 million, which will be used to fund the development of the project.
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The transaction remains subject to shareholder approval, as well as customary closing conditions. The arrangement is also subject to a $135 million termination fee.
The transaction is slated to close in the first quarter of 2025.
Filo Corp last traded at $29.42 on the TSX.
Information for this story was found via Sedar, and the sources and companies mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
