Nyrstar sells mothballed Mexican zinc mine for $20 million
Telon Resources and Reynas Minas S.A. de C.V. will pay Nyrstar USD$20 million cash for the underground mine, plus a purchase agreement linked to production. The payments will be staged from April 2017 up to a year after the deal closes.
Nyrstar's stock dropped 1.32% on the news, to finish at 5.30 euros per share in Brussels.
Campo Morado is one of seven mining operations under the Nyrstar banner, and is its only mine in Mexico. The polymetallic mine produces zinc, copper, gold and silver concentrates. There are also three mines in Peru, two in Canada and one in the United States. However Campo Morado, located in the state of Guerrero, has been suspended since the first quarter of 2015 due to ongoing security concerns in the region, Nyrstar states on a project page.
The company, which is incorporated in Belgium and trades on Euronext Brussels, also operates a zinc smelter in northern France.
In December 2016 Nyrstar (EBR:NYR) continued a process of moving away from mining by offloading a multimetallic mine in Peru and various claims in Quebec to subsidiaries of Glencore (LON:GLEN).
The transactions, worth $26 million, were part of the mining assets sale process formally launched in January 2016, which included the planned sale of the three mines in Peru listed above, Campo Morado, El Toqui in Chile, Langlois and Myra Falls in Canada, and Tennessee Mines in the U.S.
In last month's first-quarter results statement, Nyrstar said one of its strategic priorities in 2017 is to "extract maximum value from the mining portfolio by concluding the sale of the Latin American mines and optimizing the North American mines, including the restart of the Middle Tennessee and Myra Falls mines, to sell for value or continue to operate for strong free cashflow if suitable offers are not received."