BHR Partners, a Chinese private equity firm, has agreed to acquire TF Holdings, a Bermuda holding company that owns an 80% interest in Tenke Fungurume Mining for $1.136bn in cash and contingent consideration of up to $51.4m.

BHR will acquire TF Holdings from Lundin Mining Corporation, which has an indirect 30% interest in the company and an effective 24% interest in Tenke Fungurume copper/cobalt mine in the Democratic Republic of Congo.

Paul Conibear, President and CEO of Lundin Mining, said: “The decision to sell our minority interest in Tenke has been arrived at following a careful and lengthy consideration of all options open to us. It was a difficult decision, respecting the 20 years of Lundin involvement in Tenke, and the special nature of this world class asset.” 

The sale will enable Lundin Mining to advance its strategy to incrementally grow the company with projects and operations we control, while maintaining a strong balance sheet,” he said.

“We are confident that the new Tenke partners will continue to build on Tenke’s highly successful record and realize the future development potential of the properties,” he added.

The Transaction is expected close in the first half of 2017.

A termination fee of $100m, which has been secured by a letter of credit that has been received by the Company, is payable to Lundin Mining in certain circumstances, including upon termination of the Transaction due to the failure to obtain necessary regulatory approvals.

BMO Capital Markets is acting as financial advisor to Lundin Mining. Paul, Weiss, Rifkind, Wharton & Garrison LLP and Cassels Brock & Blackwell LLP are acting as legal advisors to Lundin Mining.