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(Bloomberg) — CMOC Group, a leading Chinese cobalt and copper miner, agreed to buy Canada’s Lumina Gold Corp. for about C$581 million ($420 million) to tap the largest primary gold deposit in Ecuador.
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CMOC will acquire all shares of Lumina Gold at C$1.27 a piece in an all-cash transaction, subject to approvals, the Vancouver-based company said in a statement. That represents a premium of around 40% to its closing price on April 17.
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Lumina is focusing on developing the Cangrejos gold project in El Oro province, southwest Ecuador. In 2023, the company completed a pre-feasibility study on the project.
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The Chinese miner overtook Glencore Plc in 2023 as the world’s biggest cobalt producer and posted a record profit last year, boosted by higher copper prices. Gold has reached a series of all-time highs this year after US President Donald Trump kicked off a global trade war, lifting haven demand.
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Mining deals involving China often face challenges. The Canadian government in 2022 placed restrictions on foreign investment in its mining sector, in a move widely seen as targeting China’s influence in the global critical minerals supply chain. CMOC sold a controlling stake in its Northparkes copper and gold mine in Australia in 2023, citing geopolitical concerns.
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The deal will bring benefits to Lumina including a “highly credible and capable counterpart with track record of successful M&A,” according to the statement. The parties expect the transaction to be completed in the third quarter pending on approvals from relevant parties and authorities, it said.
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