Each week, Mining Technology’s writers select a deal that illustrates the themes driving change in our sector. The deal may not always be the largest in value or the highest profile, but it will tell us where the industry is focusing its efforts, and why. This thematic deal coverage is drawn from GlobalData’s Intelligence Centre, which collates information from across the sector.
The deal
Hudbay Minerals has announced a definitive agreement to purchase 100% of the shares of Rockclliff Metals that it does not already own. With current Rockcliff shareholders receiving 0.006776 of a Hudbay share for each common Rockcliff share they hold, the deal will represent around $13m (C$17.25m) in enterprise value.
The parties
Candian miner Hudbay is a global explorer and extractor of minerals, primarily copper concentrate, molybdenum concentrate and zinc. It operates projects in the US and Canada, with a solitary surface mine in Peru.
Formerly known as Solvista Gold, Rockcliff Metals explores and develops projects focusing on a number of minerals including gold, copper and silver, among others. It posted an operating loss of $5m for the 2022 fiscal year, following a $5.1m loss the previous year.
The implications
The purchase of Rockcliff will allow Hudbay to consolidate operations at its Talbot copper/gold project. Rockcliff holds 49% of the Talbot project as a joint venture partner. The project holds an indicated 2.194 million tonnes of mineral resources, with a further 2.445 million inferred.
A total of 7.9 million tonnes of minerals are indicated and another 5.1 million inferred across all of Rockcliff’s operations. This includes six Rockcliff solely owned deposits in the Snow Lake region of Manitoba, Canada, where Hudbay also operates. While Rockcliff is primarily an explorer on these six deposits, and does not operate any, it is still among the largest landowners in the Snow Lake area with more than 1,800km² of area combined across its properties.
The purchase, tripling Hudbay’s land ownership in the area, will extend mine life and prolong operations in the region. It will also allow for the scaling up of operations at the deposits that Rockcliff itself could not develop.
While Hudbay explores at a number of locations across Canada, Snow Lake is one of only two locations in the country where it is currently extracting any minerals. In 2022, after 18 years of production, the company closed its 777 Mine in Manitoba. Staff and equipment were transferred from the site to Snow Lake, while a new mill is also in operation at the site. The refocus of Hudbay’s Manitoba strategy to focus on Snow Lake will as such be driven by the Rockcliff purchase.
