Silvercorp expands reach with C$200m Adventus acquisition
In a move aimed at diversification, Canadian mining firm Silvercorp has announced a C$200-million deal to venture into Ecuador, just weeks after missing out on acquiring control of Tanzania-focused OreCorp.
The all-share offer for TSX-V-listed Adventus Mining, valued at C$0.50 a share, will establish Silvercorp, traditionally focused on China, as a fresh entrant in South America.
“The transaction will create a new globally diversified green metals producer,” said Silvercorp chairperson and CEO Dr Rui Feng.
Central to the acquisition is Adventus’ El Domo project, which promises high margins and near-term production.
According to a December 2021 feasibility study, El Domo will produce an average of 10 463 t/y of copper and 21 390 t/y copper-equivalent over its ten-year mine life at a C1 production cash cost of $1.14/lb and an all-in sustaining cost of $1.26/lb copper-equivalent.
The study estimates a capital cost requirement of $248-million.
Leveraging a $175.5-million stream with Wheaton Precious Metals and Silvercorp’s existing cash and cash equivalents of about $200-million, the combined entity will have sufficient capital resources to fully fund El Domo through to construction.
Having built eight mines, three flotation mills of similar size to El Domo and three tailings storage facilities, Silvercorp believes it has the technical capabilities to bring the Ecuador project into production on an accelerated basis.
“We look forward to working with the government of Ecuador and local communities, as well as leveraging the existing Adventus and Curimining teams, to grow our business in Ecuador which will generate sustainable economic, social and environmental value for all stakeholders,” said Feng.
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