On September 5, Nevsun Resources Ltd. announced it has entered into a definitive agreement with Zijin Mining in a takeover bid where it will acquire all of the issued and outstanding shares of Nevsun for US$1.41 billion.

The cash offer represents a premium of 57% over Nevsun’s unaffected closing price of C$3.82 on May 7, the day Lundin Mining Corp. first publicly announced its intention to acquire Nevsun. Zijin’s offer is 26% more than the hostile takeover bid launched by Lundin on July 26.

Nevsun’s Board of Directors unanimously recommended that shareholders accept Zijin’s offer, while still recommending that it rejects the Lundin offer. The Lundin offer will expire on November 9.

“This premium transaction is an excellent outcome for our shareholders, and the result of a rigorous and competitive global process to generate maximum value for Nevsun’s outstanding assets,” said Ian Pearce, chair of Nevsun’s Board of Directors. “The all-cash consideration of C$6 per share better reflects the fundamental value of Nevsun’s mining and development assets, while also providing an appropriate change of control premium to our shareholders.”

Chen Jinghe, chairman of Zijin, said, “Nevsun is an exceptional operator, with a strong focus on safe, efficient and sustainable mining practices. As the new owner, we will continue that focus, and we look forward to working with stakeholders in Eritrea and Serbia to advance these mining and development assets.

“At the Bisha mine in Eritrea, our objective will be to further extend the life of the mine and explore for new deposits. At the Timok Project in Serbia, we intend to rapidly develop the Upper Zone and bring it into production, and continue to advance and define the world-class potential of the Lower Zone.”

Nevsun’s Board of Directors had previously rejected the hostile bid from Lundin because it believed it ignored the fundamental value of Nevsun’s assets.

Formed in 1993, Zijin is based in Fujian, China, and is a global mining company specializing in gold, copper, zinc and other mineral resource exploration and development. Among Zijin’s substantial global mining activities are strategic partnerships with Toronto-based Barrick Gold Corp., related to the Porgera mine in Papua New Guinea; and Vancouver-based Ivanhoe Mines Ltd., related to the Kamoa-Kakula copper project in the Democratic Republic of Congo. Zijin also completed a  board-supported takeover of Norton Gold Fields Ltd., an Australian mining company, in 2015.