Glencore reached an agreement with Santa Cruz Silver Mining Ltd. for it to acquire the holding companies that own Glencore’s Bolivian zinc assets, comprising of Sinchi Wayra and Illapa. Glencore will receive an initial amount of US$20 million on the completion date and a further US$90 million to be paid within four years or less from completion.
The sale is expected to be complete in the next three months.
At completion, Glencore will enter into a number of net smelter royalty agreements each at 1.5%, which provide for continued life of mine payments based on the performance of the relevant mines. Glencore will also retain offtake rights for the life of the mine.
Sinchi Wayra S.A. owns the Reserva, Tres Amigos and Colquechaquita mines, the Don Diego concentrator and power plants, the Sorocaya project and San Lucas. Sociedad Minera Illapa S.A. (Illapa) owns a 45% contractual joint venture right in the Porco and Bolivar mines. Corporacion Minera De Bolivia will continue to own the Illapa Mines and retain a 55% contractual joint venture right.