Nevsun Resources Rejects $1.16b Takeover Offer

Development News
Nevsun rebuffs Lundin’s takeover offer
Nevsun rebuffs Lundin’s takeover offer. The Timok upper zone Net Present Value alone (at 8% discount rate) is US$1.5 billion. This is without adding the massive Bisha copper-zinc mine. (Photo: Martin Zimmermann)


Canadian miners Lundin Mining Corp and Euro Sun Mining Inc disclosed on Monday an offer made earlier to buy base metals company Nevsun Resources Ltd, which rejected the C$1.5 billion ($1.16 billion) proposal.

Under the terms of the offer dated April 30, Nevsun shareholders were to receive a total consideration of C$5 per Nevsun share including C$2 in cash funded by Lundin Mining, C$2 in shares of Lundin Mining and C$1 in shares of Euro Sun, Lundin Mining and Euro Sun said in a joint statement.

Vancouver-based Nevsun rejected the offer on Monday, the statement added.

“After months of attempting to reach an agreement, we are disappointed that Nevsun has prevented its shareholders from considering our premium proposals,” the companies said, adding that they remain committed to negotiating a deal with Nevsun.

“At this point in time, we believe that all Nevsun shareholders should be made aware of this opportunity,” they said.

According to the offer, Lundin Mining owning the European assets of Nevsun including the Timok project and Euro Sun owning the remainder of Nevsun including the Bisha mine and Nevsun’s cash balance.

Mr. Paul Conibear, President and CEO of Lundin Mining commented:

“We believe our proposal is extremely compelling and in the best interests of Nevsun shareholders. Our significant experience in underground construction and mining and track record of operating in Europe demonstrate our ability to be a strong and reputable developer of the Timok project in Serbia. Given the significant near-term financing needs of the Timok project and our strong balance sheet, the timing is ideal for Lundin Mining to acquire the Timok project and bring it into production as soon as possible. Our inclusion of cash and Lundin Mining shares will allow Nevsun shareholders to both crystallize value now and continue to share in the future growth of not only the Timok project but benefit from the success of Lundin Mining’s operations, while participating in Lundin Mining’s future dividends.” Mr. Conibear continued, “After months of attempting to reach an agreement, we are disappointed that Nevsun has prevented its shareholders from considering our premium proposals and at this point in time, we believe that all Nevsun shareholders should be made aware of this opportunity.  We remain fully committed to negotiating a transaction with Nevsun under the very attractive terms proposed.”

Mr. Scott Moore, President & Chief Executive Officer of Euro Sun commented:

“The acquisition of Bisha represents a unique value creation opportunity for both current Euro Sun shareholders and to our prospective new Nevsun shareholders. The addition of an operating asset will substantially de-risk the development of the Rovina Valley gold-copper porphyry project in Romania and we will look to add value at the Bisha mine through an aggressive exploration program. The Board and management of Euro Sun have a demonstrated track record of generating outstanding shareholder returns, including through their prior involvement with Avion Gold, and the purchase of Nevsun’s Tabakoto assets in Mali, which was subsequently sold at a significant premium. We strongly believe the potential of Bisha is well beyond its current mine life and Rovina represents an opportunity for all stakeholders to participate in the second largest gold project in Europe. We look forward to the opportunity to deliver increased value at Bisha and Rovina Valley to all the stakeholders of Nevsun as Euro Sun shareholders.”


Lundin Mining has been unable to successfully engage Nevsun in meaningful discussions after numerous attempts. Lundin Mining submitted its first proposal to Nevsun on February 7, 2018 and a further proposal on February 25, 2018, both of which were rejected.

On April 3, 2018, Lundin Mining submitted a proposal to Nevsun to acquire Nevsun’s European assets, including the Timok project, for cash and shares, which was also rejected.

Lundin Mining has since found a partner to lead the acquisition of 100% of Nevsun at a significant premium. On April 30, 2018 Lundin Mining and Euro Sun submitted the Proposal to Nevsun for its consideration, which would allow Nevsun shareholders to continue to benefit from the advancement of the Timok project and from Lundin Mining’s operations as well as maintain material exposure to the Bisha mine as shareholders of Euro Sun and benefit from Euro Sun’s 100%-owned Rovina Valley gold-copper project in the Tethyan Belt of Romania. On May 7, 2018, Nevsun rejected the Proposal.

Lundin Mining and Euro Sun are highly qualified partners with both parties having a demonstrated track record, a proven project execution ability, an experienced management team, access to capital markets and acquisition integration expertise.