Linklaters has advised Hong Kong Listed MMG limited (MMG) on the exchange of its remaining 70% interest in the Mutoshi mine for exploration and development rights over eight permits held by DR Congo State-owned entity Gécamines in areas adjacent to the Kinsevere mine, a significant copper mine already operated by MMG. MMG’s major Shareholder is China Minmetals Corporation.
The transaction was completed on 5 September 2013 and entitles MMG to undertake exploration activities and exploit up to 1.8 million tonnes of contained copper metal over the eight permits. It involved the conclusion of a framework agreement setting out the detailed conditions for the asset exchange and development of the eight permits, a lease agreement (contrat d'amodiation) whereby Gécamines grants MMG registered rights over the eight permits and a share purchase agreement for the transfer of its remaining 70% interest in the Mutoshi copper mine to Gécamines.
MMG originally acquired its 70% interest in Mutoshi when it completed its takeover of Anvil Mining in February 2012, on which Linklaters acted for MMG. That takeover triggered an option for Gécamines to acquire the remaining 70% interest in Mutoshi for US$52.5 million. This exchange now implements a payment in kind of that original option exercise price.
In addition, the transaction raised certain technical listing implications for MMG under the Hong Kong Listing Rules, on which Linklaters Hong Kong has advised.
This transaction aligns with MMG’s strategic objective of extending the life of the Kinsevere mine (and related treatment plant) and expanding its presence in the region.
The Paris Linklaters office was responsible for all mining and Congolese law issues (with the assistance of local counsel), particularly whilst acting on the legal due diligence and the negotiation of the different agreements with Gécamines.
The Paris Linklaters team was led by Bertrand Andriani, partner in the Projects department, with the support of Aymeric Voisin, senior associate. They were assisted by Aurelia Parra and Ghita Bennis, associates. A Linklaters team based in Hong Kong, led by partner Craig Dally with the support of Iris Yeung and Alexandra Bidlake, was responsible for aspects relating to stock exchange regulations and other Hong Kong law matters.
The Paris Linklaters office has an acclaimed expertise in the mining sector, particularly in Francophone Africa where it regularly intervenes in key operations, ranging from the disposal of assets to the development and financing of projects. By way of example, the team recently advised MMG on its acquisition of Anvil Mining Ltd in the Katanga province of the DRC and also worked on many joint-ventures, developments and financings for the rehabilitation and exploitation of copper and cobalt mines in DRC such as the KOV or Kolwezi Tailings projects. It also advised Korea Electric Power Corporation on the acquisition of an indirect participation of the Imouraren uranium mine in Niger and on the multilateral financing of the Sadiola gold mine in Mali.
Emery Kalamba acted as DRC counsel to MMG.
Orrick Rambaud Martel Paris acted for Gécamines with a team composed of Pascal Agboyibor, partner, and associates Sydney Domoraud-Operi and Bob Bastos.
