Diversified miner Hudbay Minerals on Monday announced it would buy Arizona Sonoran Copper Company in a $1.48-billion all-share transaction, creating the third-biggest copper district in North America.

The deal would combine Arizona Sonoran's Cactus project with Hudbay's Copper World development.

Hudbay will acquire all outstanding Arizona Sonoran shares it does not already own in exchange for 0.242 of a Hudbay share for each Arizona Sonoran share. The offer implies a value of C$9.35 a share, representing a 30% premium to Arizona Sonoran’s February 27 closing price and a 36% premium to its 20-day volume-weighted average price.

“Cactus is a high-quality, large-scale copper development asset in a mining jurisdiction that we know well. Together with the advancement of Copper World, this transaction creates one of the most significant copper districts in North America and reinforces Hudbay’s position as a premier copper growth company, while preserving financial flexibility and delivering long-term value for shareholders,” said Hudbay president and CEO Peter Kukielski.

Hudbay currently produces about 125 000 t/y of copper. With Copper World and near-term optimisation projects, output is expected to exceed 250 000 t/y by 2030, with potential to grow to more than 350 000 t/y as Cactus is developed in stages.

The combined district is expected to become one of the largest sources of domestically produced copper cathode in the US, positioning Hudbay as a key supplier to the US critical minerals supply chain. Copper World is projected to produce an average 92 000 t/y of copper in its first 10 years, while Cactus is expected to add a further 103 000 t/y based on its prefeasibility study.

Arizona Sonoran president and CEO George Ogilvie said the deal delivered immediate value while allowing shareholders to retain exposure to Cactus through ownership in Hudbay.

“Through ownership in Hudbay, our shareholders will gain immediate exposure to strong cash flow generation from a larger, diversified and well-capitalized operating platform, while continuing to participate in the long-term value of Cactus and adding exposure to Hudbay’s Copper World project as part of a new major copper hub in Arizona,” he said.

Following completion, existing Hudbay shareholders will own about 89% of the enlarged company, with Arizona Sonoran shareholders holding the remaining 11%.

The transaction, structured as a court-approved plan of arrangement under British Columbia law, requires approval by Arizona Sonoran shareholders at a special meeting expected in May, as well as customary regulatory and court approvals. Closing is targeted for the second quarter of 2026, after which Arizona Sonoran shares will be delisted from the TSX.