Glencore sells two Africa zinc mines to Canada’s Trevali
Mining and commodities trader Glencore (LON:GLEN) is selling its stakes in two zinc mines to Canada’s Trevali (TSX:TV) in a deal worth about $400 million that will make the later the first pure zinc company with operations in North and South America as well as Africa.
With the sale, Glencore gives Trevali its 80% and 90% stakes respectively in the Namibia-based Rosh Pinah and the Perkoa mine located in Burkina Faso, while it also increases its direct holding in the Vancouver-based miner from 4% to 25%, getting two seats on the Trevali’s board.
“We are excited to form part of this unique global zinc vehicle, providing pure zinc exposure across a wide geographic footprint,” Daniel Mate, Glencore’s head of zinc marketing, said in a statement.
Trevali’s chief executive Mark Cruise added that acquiring both African mines was “a unique opportunity” for the company’s shareholders.
It opens the door for the creation of a “multi-asset, low-cost global zinc producer,” whose output will double to approximately 410 million pounds per year, placing the company among the world’s top 10 zinc producers.
Rosh Pinah opened in 1969 and is expected to have a further 14 years of operating life, while Perkoa is set to produce for another six years.
Trevali, which already has operations in Canada and Peru, said the transaction is subject to regulatory approvals and is expected to close by July.
Zinc was one of the best performing commodities last year, climbing up 60% as a few top mines, such as Lisheen in Ireland and Century in Australia, closed down and miner including Glencore and Nyrstar suspended some production.