Former Barrick Gold’s chief executive Aaron Regent, through its private equity-backed Magris Resources Inc., got the green light to become the brand new owner of Iamgold Corp.’s niobium mine in Quebec, acquired for US$530 million in cash.
The long-planned sale of Niobec, located in the Saguenay-Lac-Saint-Jean region in Quebec, was agreed in October last year, but Iamgold (TSX: IMG) (NYSE: IAG) was waiting for regulatory approvals to proceed. Now that they are in place, said the Toronto-based miner in a statement, the sale — which includes adjacent rare earths deposit — should close before the end of the month.
Niobec is Regent’s first acquisition since getting back in the mining game and comes after his failed attempts to buy Glencore’s (LON:GLEN) Las Bambas copper project in Peru and Chile’s Candelaria copper mine from Freeport-McMoran Inc (NYSE:FCX).
The mine, acquired by the Toronto-based gold miner in 2006, is one of the world’s three producers of niobium, a rare metal with superconductive properties used to strengthen steel. Niobium is used to make alloys for jet engines and to strengthen steel.
Regent is not alone in this venture. The acquiring Asian group includes Singapore’s Temasek Holdings and CEF Holdings Ltd, a Hong Kong-based investment company owned by Canadian Imperial Bank of Commerce and billionaire Li Ka-shing’s Cheung Kong Holdings Ltd.
The deal shifts Iamgold into a pure-play gold company, significantly improving its balance sheet at difficult time for gold miners globally.