By Felix Njini
JOHANNESBURG (Reuters) -Harmony Gold, South Africa’s top gold producer by volume, has agreed to buy Australian miner Mac Copper Ltd in a deal worth $1.03 billion as it steps up a diversification into copper.
Johannesburg-based Harmony said it is offering $12.25 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 in a statement that its board unanimously backs the offer.
The Australian company’s CSA Copper mine, situated in New South Wales, produced 41,000 metric tons of the metal last year and Harmony said that buying a producing mine brings immediate cash returns.
The acquisition will be financed with internal cash reserves and a $1.25 billion 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 metric tons 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 toward Harmony growing into a global gold and copper producer, CEO Beyers Nel said.
(Reporting by Felix Njini in Johannesburg, Additional reporting by Melanie Burton in Melbourne; Editing by Kirsten Donovan)
