Glencore PLC (GLEN.LN) said Tuesday that it is to increase its stake in Volcan Compania Minera S.A.A. (VOLCABC1.VL) by acquiring 26.73% of the company's A shares for $531 million.
It added that it plans to make an offer to all shareholders via a public tender offer.
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The Swiss mining and trading giant said it has agreed to pay $1.22 per class A share of Volcan. Glencore, which currently holds 18.11% of the class A shares of Volcan, added that it intends to make an offer for up to an additional 48.19% of the total A shares of the Peruvian mining company at $1.22 each.
Glencore expects to make the offer by no later than Oct. 27. Depending on the level of acceptances, Glencore will hold between 44.84% and 66.30% of the total A shares in Volcan, and will have an economic interest--taking into account the class B common shares and excluding treasury shares--of between 18.98% and 28.07%. The aggregate value of the deal will be between $531 million and $956 million, the company added.
Glencore has been a shareholder in Volcan since 2004 and its current stake amounts to 18.11% A shares and 0.02% B shares, reflecting an economic interest of 7.68%.
The transaction will boost Glencore's zinc production profile, as Volcan's operations are located in an area in Peru that produces some of the highest quality zinc concentrates, the Swiss company said.
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(END) Dow Jones Newswires
October 03, 2017 12:08 ET (16:08 GMT)