Ivanhoe, CITIC complete second major financing for Congo mines
Canada’s Ivanhoe Mines (TSX:IVN) has received a second major strategic investment of C$612 million (about $490m) from its largest shareholder, China’s state-owned CITIC Metal, that will be used towards speeding up construction of a giant copper mine in the Democratic Republic of Congo.
The financing, part of long-term strategic cooperation between the two companies, brings CITIC’s investment in Ivanhoe to more than $1 billion.
Another Chinese firm, Zijin Mining Group — which became Ivanhoe’s partner four years ago — exercised its anti-dilution rights in May, generating additional proceeds for the Vancouver-based miner of C$67 million ($50m).
“The investments completed today comfortably provide Ivanhoe with the equity cushion required to rapidly advance Kamoa-Kakula’s 6 Mtpa Phase 1 mine to production,” billionaire Robert Friedland, the company’s founder and executive chairman said in a statement.
CITIC now owns 29.4% of Ivanhoe Mines’ issued and outstanding common shares, with Zijin Mining holding 9.8%.
Friedland, who made his fortune from the Voisey’s Bay nickel project in Canada in the 1990s, has said the capacity of the project’s first phase could later be easily tripled.
The mining complex, which is expected to begin commercial production in late 2021, has the potential to become the world’s second-largest copper mine.
Analysts also believe the giant mine could restore the DRC’s historical position as one of the world’s top copper producing countries.
Ivanhoe Mines has been working on Kamoa-Kakula for ten years. In 2015, its now partner Zijin got on board by acquiring a stake in the company. CITIC Metal followed suit last year, becoming Ivanhoe’s top shareholder.