Mitsubishi to Invest $600 Million in Hudbay Copper Project
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for a 30% stake in a proposed U.S. copper project being developed by Hudbay Minerals Inc. Shares of the Canadian company soared to the highest in more than 14 years.
“Securing Mitsubishi as a 30% partner in Copper World is an important milestone for Hudbay as we establish a long-term strategic partnership to advance this high-quality copper project toward sanctioning and to unlock significant value in our copper growth portfolio,” Hudbay CEO Peter Kukielski said Aug. 13 in a statement.
Shares of Hudbay surged as much as 23% as of 9:31 a.m. in Toronto to touch C$16.69, the highest intraday since April 2011.
Earlier this year, Hudbay initiated a process to sell a minority portion of its flagship Copper World project in Arizona. That drew expressions of interest from investors in Saudi Arabia as well as the United Arab Emirates and Japan, according to the CEO.
Hudbay's Copper World is expected to generate significant benefits for the community and local economy in Arizona, including a total of $1.7 billion to construct Phase I of Copper World. — Hudbay Minerals (@HudbayUS)
The deal with Mitsubishi comes as miners and trading houses race to boost their exposure to copper. Demand for the metal is poised to surge in the coming decades, driven by the rollout of electric vehicles, renewable energy projects and data centers.
Copper producers, including Rio Tinto Group, have long focused on Arizona to develop projects that can meet U.S. demand. Copper World is about 160 miles northwest of Phoenix. Toronto-based Hudbay, which also operates copper and gold mines across the Americas, estimates the project could yield 85,000 tons of copper per year when developed, with an expected mine life of 20 years.
Barclays Plc and Toronto-Dominion Bank were financial advisers to Hudbay while Sullivan & Cromwell LLP was legal counsel.
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