Lundin Mining to reshape portfolio with sale of Neves-Corvo and Zinkgruvan mines to Boliden

Lundin Mining Corporation has taken a transformative step by announcing the sale of its Neves-Corvo and Zinkgruvan mines to Boliden AB for up to $1.52 billion. This Lundin Mining sale, revealed on 9 December 2024, underscores the company’s pivot towards a more copper-dominant strategy, focusing on high-value assets in South America.

The agreement includes $1.37 billion in upfront cash and up to $150 million in contingent payments, depending on copper and zinc price thresholds. The Boliden mine acquisition is expected to close by mid-2025, subject to regulatory approvals and customary closing conditions.

A Strategic Shift for Lundin Mining

Lundin Mining’s CEO, Jack Lundin, stated that the divestment aligns with the company’s copper-dominant strategy, enabling it to channel resources into expanding operations in the Vicuña District of South America. The proceeds from the Lundin Mining sale will strengthen the company’s balance sheet, providing critical funding for exploration and growth projects.

According to Lundin, the Neves-Corvo and Zinkgruvan mines have been pivotal in the company’s success. However, transitioning these assets to Boliden will allow Lundin to prioritise areas with greater long-term potential.

Details of the Boliden Mine Acquisition

Boliden has committed to acquiring 100% of the shares of Somincor–Sociedade Mineira de Neves-Corvo and Zinkgruvan Mining Aktiebolag. This Boliden mine acquisition includes upfront consideration based on a cash-free, debt-free valuation of $1.3 billion. The additional contingent payments are tied to price benchmarks for copper and zinc.

For Neves-Corvo, Boliden will pay up to $100 million if copper prices exceed $4.50/lb and zinc prices surpass $1.30/lb between 2025 and 2027.

For Zinkgruvan, up to $50 million is contingent on zinc prices exceeding $1.40/lb, alongside meeting production thresholds.

Boliden’s Growing Presence

This Boliden mine acquisition will significantly enhance its zinc and copper production capacity. Mikael Staffas, CEO of Boliden, described the move as a “strategic fit” that complements its existing operations. With Neves-Corvo and Zinkgruvan in its portfolio, Boliden will increase its zinc concentrate production to 70% of smelting capacity and copper to 40%, bolstering its market position.

Staffas highlighted that the acquired assets are well-invested and offer opportunities for near-mine exploration, aligning with Boliden’s long-term vision. The acquisition is projected to contribute $300–350 million annually to EBITDA over the next five years.

Looking Ahead

The Lundin Mining sale signals a major shift in the company’s trajectory. By adopting a copper-dominant strategy, Lundin is positioned to capitalise on the growing demand for copper in renewable energy and electric vehicle markets. Meanwhile, Boliden stands to benefit from enhanced production capacity and expanded operations in Europe.

As the mining industry continues to evolve, this deal exemplifies how companies are reconfiguring portfolios to maximise value and operational efficiency.