Toronto-based HudBay Minerals recently sold 100% of its interest in the Fenix ferro-nickel project in Guatemala to the Solway Group. Under the terms of the agreement, HudBay will receive $140 million in cash at closing and $30 million upon the satisfaction of certain conditions during the course of Solway’s development of the project.
“While we believe Fenix is a robust project that warrants development, the project does not fit our strategy of focusing on VMS [volcanogenic massive sulphide] and porphyry deposits,” said David Garofalo, president and CEO, HudBay Minerals. “We believe the sale proceeds will further strengthen our balance sheet as we develop our Lalor and Constancia projects. We are also pleased to see the project in the hands of an experienced ferro-nickel operator, such as the Solway Group, which is committed to the development of Fenix.”
The transaction is expected to close in the third quarter of 2011.