In a significant strategic move and one of the biggest transactions in the copper sector this year, Lundin Mining Corporation and BHP have agreed to acquire Filo Corp. in a deal valued at C$4.500 billion. This acquisition aims to consolidate and develop two major mining projects in San Juan province and strengthen both firms' positions in the global copper market. Josemaría and Filo del Sol are at the forefront of leading the country's copper landscape.
By Panorama Minero
Lundin Mining and BHP have agreed to acquire all outstanding shares of Filo Corp, offering Filo shareholders C$33.00 per share. This offer represents a 32.2% premium over the 30-day volume-weighted average price of Filo shares prior to transaction speculation, and shareholders can choose to receive payment in cash, Lundin Mining shares, or a combination of both.
Simultaneously, the two mining giants will form a 50/50 joint venture (JV) that will integrate the Filo del Sol project, currently owned by Filo Corp, and Lundin Mining’s Josemaría project. This new entity will facilitate the joint development of the Vicuña district, creating one of the most significant operational footprints in the region and the copper industry. This partnership will benefit from BHP’s global experience in developing large-scale projects and the financial strength of both companies, according to a statement.
Impact and Benefits
The deal not only delivers immediate value to Filo but also paves the way for the comprehensive development of the Filo del Sol project, one of Argentina's most promising copper mining centers. Additionally, the JV will leverage operational synergies and efficiencies, as well as recent Argentine legislation that supports developing mining projects to advance more quickly toward production stages. The integration of Filo del Sol and Josemaría will enable infrastructure sharing and cost optimization, accelerating the district's development under a phased timeline that reflects improved investment conditions in Argentina. Furthermore, the potential benefits of combining both projects will be explored.
According to Lundin, the strategy secures an experienced partner for the Vicuña district development: the partnership will thus benefit from BHP's extensive global expertise in large-scale project development and integrated operations while ensuring a strong financial position and key know-how for such projects.
Moreover, the cash impact for Lundin Mining related to the transaction is marginally positive, as Lundin will pay a total consideration to Filo shareholders of C$2.148 billion, with C$859 million (US$620 million) in cash and C$1.289 billion in Lundin shares, while receiving a cash consideration of US$690 million from BHP in connection with the Josemaría transaction and project advances. The joint venture will be funded 50/50 by Lundin Mining and BHP, with Lundin Mining continuing to fully fund Josemaría until the closing date, assumed to be December 31, 2024, subject to certain adjustment mechanisms.
Executive Statements
Jamie Beck, CEO of Filo Corp, expressed enthusiasm for the transaction: “This deal provides compelling value to our shareholders, along with future exposure to the development of Filo del Sol alongside Lundin Mining’s high-quality operation portfolio. This agreement marks the right moment to pass the project to its next managers, who will maximize its potential.”
Jack Lundin, President and CEO of Lundin Mining, highlighted: “This strategic transaction is key to unlocking the immense value of the Vicuña district. Partnering with BHP positions us to create a multigenerational mining district with significant synergies and cost savings, potentially making it one of the largest in the world.”
Conditions and Expectations
The transaction will proceed through a court-approved plan under the Canada Business Corporations Act and requires approval from at least two-thirds of Filo shareholders' votes. The transaction is expected to close in the first quarter of 2025, subject to regulatory approvals and other customary closing conditions.
“This acquisition reinforces Lundin Mining and BHP’s commitment to developing sustainable, world-class mining projects, highlighting their ability to generate economic and social value in their global operations,” the statement concluded.
