A unit of Chinese state-run conglomerate CITIC will become this month Canada's Ivanhoe Mines' (TSX:IVN) biggest shareholder following billionaire Robert Friedland's company's decision to sell a 20% stake for about $548 million (C$723m).
The deal, announced in June, has received all necessary approvals from China's regulatory agencies, so it's expected to close on Sep. 19, the companies said in a statement.
As part of the transaction, CITIC Metal has already loaned $100 million to Ivanhoe Mines, which is using the funds advance projects in southern Africa, including its flagship Kamoa-Kakula project in the Democratic Republic of Congo - considered the most significant copper discovery in decades.
Another Chinese firm, Zijin Mining Group - which acquired a stake in Ivanhoe Mines in 2015 through a wholly-owned subsidiary - has exercised its existing anti-dilution rights through a concurrent private placement. This means that Zijin owns now 9.7% of Ivanhoe Mines.
Ivanhoe Mines estimates the asset, discovered in 2007, holds the equivalent of at least 45 million tonnes of pure copper. The company aims to extract 300,000 tonnes per year once the mine is operating at full tilt.