EuroZinc Mining Acquires Neves Corvo Copper Mine

On June 18, 2004, EuroZinc Mining Corp. completed the acquisition of 100 per cent of the shares of Sociedade Mineira de Neves Corvo, SA (Somincor), the Portuguese company that owns the Neves Corvo copper mine in Portugal. The shares were purchased from the Government of Portugal (which owned 51 per cent of Somincor) and Rio Tinto (which owned the balance), for a total purchase price of €128 million (approximately US$155 million).

The purchase price, together with the repayment of certain outstanding debts and shareholder loans within Somincor, was financed in part by a C$9.6 million agency private placement of units in December 2003/January 2004 and a C$30 million underwritten private placement of special warrants in February 2004, each through Paradigm Capital Inc. and Pacific International Securities Inc., together with a C$78.5 million underwritten private placement of special warrants through a syndicate comprising Paradigm Capital Inc., Haywood Securities Inc., Orion Securities Inc. and Pacific International Securities Inc. in April 2004 (the April 2004 special warrants were subsequently qualified by way of a short form prospectus). In addition, a US$100 million syndicated loan was provided by Standard Bank London Ltd., Société Générale and Bayerische Hypo- und Vereinsbank AG.

The transaction also involved the negotiation of a new ten-year copper concentrate offtake agreement between Somincor and Boliden Mineral AB of Sweden, a one-year bridge loan of US$10 million from Boliden to EuroZinc and a technical support agreement with Boliden’s parent company, Outokumpu Technology OYJ of Finland. Following completion of the acquisition EuroZinc’s listing was upgraded from the TSX Venture Exchange to the Toronto Stock Exchange.

In relation to the equity offerings, short form prospectus filing, bridge loan and the listing on the Toronto Stock Exchange, EuroZinc was represented by Gowling Lafleur Henderson, with a team that included Louis Montpellier, Cyndi Laval, Daniel Allen and Stuart Breen (securities/corporate) in Vancouver, and Alan Rautenberg (tax) in Calgary.

In relation to the acquisition, syndicated loan, bridge loan and commercial arrangements with Boliden and Outokumpu, EuroZinc was represented by Blake, Cassels & Graydon, with a team that included David Glennie, Bob Wooder, Aaron Palmer and John Wilkin, (corporate/securities/banking) in London, England, Brendan Reay (securities) and Ken Snider and Chris Van Loan (tax) in Toronto.
EuroZinc’s local counsel in Portugal were Coelho Ribeiro E Associados, with a team that included Rui Botica Santos and Pedro Nuno Monteiro. White & Case in London, England provided counsel on English law matters, with a team that included Magdalene Bayim-Adomako and Greg Stonefield.

The underwriters on the equity offerings were represented by Goodman and Carr, with a team that included Jay Goldman, Jenny Chu Steinberg and Peter Laflamme (securities). The banks providing the syndicated loan were represented by Norton Rose in London, England, with a team that included Chris Brown and Sheila Jamieson.