Latest news with #R18.42bn
TimesLIVE
4 days ago
- Business
- TimesLIVE
Harmony's $1bn (R18bn) copper deal a 'sweet spot' for the company
South Africa's biggest gold producer Harmony Gold estimates that by the 2035 financial year, 45% of its production will come from Australasia after agreeing to buy Australia's Mac Copper for $1bn (R18.42bn). The MAC Copper acquisition is its second foray into copper after buying the Eva Copper project in Queensland in 2022, a mine that is likely to produce up to 60,000 tonnes of the metal a year from 2029. CEO Beyers Nel said MAC Copper's CSA Copper mine in New South Wales, which produces 40,000 tonnes of the metal a year, represented a 'sweet spot' for the group. 'There is a scramble for copper mines in the market at the moment, people pay top dollar. But we believe because this mine is a deeper mine — it is more of a mine that suits Harmony's skills set — it potentially kept other bidders out of the mine. 'It is too big for the juniors and probably too small for the majors. The 40,000 tonnes of copper from a size point of view is ideal and a sweet spot for a company like Harmony to take it. It is production from day one because it is an operating mine. It is also in a tier-one mining jurisdiction; New South Wales in Australia is a good place to mine,' said Nel. Nel said the shift enhanced profitability, reduced geographical concentration risks, and positioned Harmony to deliver sustainable long-term returns. He said the mine also presented near-term copper into Harmony's production mix as opposed to its Eva project in Australia and Walfi-Golpu, a gold/copper project in Papua New Guinea (PNG) it jointly owns with Newmont Corp. He said the Walfi-Golpu project had been frustratingly slow. However despite violence at Barrick Gold Corporation's Porgera Gold Mine in Papua New Guinea's Enga province, the area was calm. 'I would not say there are problems there. It is calm. People sometimes throw one blanket over Papua New Guinea and think what is happening at Porgera with Barrick is happening everywhere in Papua New Guinea. That is not th e case. Where our mine is, things are calm and the communities are supportive of the mine,' he said. The Harmony share traded 6% lower after the announcement this week. Nel said the market still needs to digest the deal. 'It is still $1bn, it's a lot of money. It is typical that when a big transaction takes place that the buying company's share price comes under pressure. 'We are not fixated about the day trade, we think this is a good asset for Harmony's skills set and we can add a lot of value to it, there is a lot of blue sky, upside potential beyond the current mine life. We are very bullish about the copper price long term. if you think about the global energy transition and supply and demand. We need to look at the long-term perspective.'
TimesLIVE
27-05-2025
- Business
- TimesLIVE
Harmony Gold agrees to buy Australian Mac Copper for R18bn
Harmony Gold, South Africa's top gold producer by volume, has agreed to buy Australian miner Mac Copper in a deal worth $1.03bn (R18.42bn) as it steps up a diversification into copper. Johannesburg-based Harmony said it is offering $12.25 (R219.18) per Mac Copper share in the cash deal, a 20.7% premium to the stock's closing price in New York on Friday. Mac Copper said its board unanimously backs the offer. The Australian company's CSA Copper mine in New South Wales produced 41,000 tonnes of the metal last year and Harmony said buying a producing mine brings immediate cash returns. The acquisition will be financed with internal cash reserves and a $1.25bn (R22.36bn) loan facility, Harmony said. Harmony's shares fell 6.3% in early morning trade in Johannesburg. It is Harmony's second acquisition of copper assets in Australia after it bought the Eva Copper project in Queensland, in 2022, a mine that could produce 55,000-60,000 tonnes of metal a year from 2029. Harmony has also explored over the years options to develop Wafi-Golpu, a gold-copper project in Papua New Guinea it jointly owns with Newmont Corp. South African mining companies including Gold Fields are increasingly looking elsewhere for assets as domestic operations become more costly due to the geological challenges presented by some of the world's deepest gold mines. Harmony said it will build on its experience in underground mining in South Africa to boost Mac Copper's CSA mine. The deal is a significant step towards Harmony growing into a global gold and copper producer, CEO Beyers Nel said.
