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Lundin Mining To Acquire Chapada Copper Mine In Brazil From Yamana Gold

Lundin Mining Corp. (LMC,LUN.TO) agreed Monday to acquire 100% ownership stake in Mineração Maracá Indústria e Comércio S/A, which owns the Chapada copper-gold mine located in Brazil from Yamana Gold Inc. (AUY,YRI.TO) for cash consideration of $800 million, subject to customary adjustments.

In addition, Yamana will retain a 2.0% net smelter return (NSR) royalty on future gold production from the Suruca gold deposit and receive contingent consideration of up to US$125 million over five years if certain gold price thresholds are met and contingent consideration of US$100 million on potential construction of a pyrite roaster.

The deal will be immediately accretive to Lundin's key operating and financial metrics, including earnings, EBITDA and operating cash flow per share.

The purchase price will be paid in cash on closing and will consist of $800 million, subject to customary adjustments. The purchase price is expected to be funded from Lundin Mining's current cash balance and a portion of its $550 million revolving credit facility.

The completion of the acquisition is expected to occur early in the third quarter of 2019 and is subject to typical closing conditions, including third-party and requisite regulatory approvals. The acquisition does not require shareholder approval of either party.

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