Going private: KAZ Minerals acquired by Nova Resources in £3bn deal

BY Fraser Tennant

In a £3bn deal designed to take it private once again, copper miner KAZ Minerals has been acquired by Nova Resources, a company owned by a consortium comprised of KAZ chairman Oleg Novachuk and Kazakh billionaire Vladimir Kim.

An all-cash-deal, under the terms of the acquisition, Nova Resources will pay the shareholders of London-listed KAZ Minerals 640 pence per share. It is It is intended that the acquisition will be implemented by way of a court-sanctioned scheme of arrangement.

A high-growth copper company focused on large scale, low cost open pit mining in the Commonwealth of Independent States (CIS) region, KAZ Minerals has a track record for the successful delivery of greenfield mining projects. The company employs around 15,000 people, principally in Kazakhstan.

"We are pleased to announce this recommended cash offer for KAZ Minerals,” said Oleg Novachuk, chairman of Nova Resources. “Mr Kim and I believe that KAZ Minerals has made notable progress as a public company since listing on the London Stock Exchange in 2005. However, driven by the current market uncertainty and the corporate circumstances of sequential development projects, we believe that KAZ Minerals' long term interests would be best served as a private company.”

Mr Novachuk is confident that the execution of a higher risk, capital intensive strategy remains the optimal long-term path for KAZ Minerals but recognises that the company’s risk appetite may be misaligned with the preference of many investors in the mining sector.

"Following extensive negotiations, the independent committee of KAZ Minerals intends to unanimously recommend the acquisition to its shareholders as representing an opportunity to realise their investment at a premium in cash in the near term,” said Michael Lynch-Bell, senior independent director and chair of the independent committee at KAZ Minerals. “We believe the offer provides a fair value for KAZ Minerals.”

The acquisition is expected  to be completed in the first half of 2021, subject to the approval of KAZ Minerals’ shareholders, receipt of the relevant antitrust clearances, regulatory approvals and the sanction of the scheme of arrangement by the court.

Mr Novachuk concluded: “In taking this important step, we wanted to ensure that KAZ Minerals’ shareholders were provided with the opportunity to crystallise the value of their investment at a premium valuation. We are confident that this acquisition will deliver an attractive return.”

News: KAZ bosses sign 3 bln pound deal to take miner private again

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