Hudbay Minerals Inc · TSX:HBM
Hudbay Minerals — Merger or Acquisition (February 2014)
17 slides from Hudbay Minerals's merger presentation, Feb 10, 2014
Slide 1: Proposed Acquisition of Augusta
A Leading Intermediate Base Metals Mining Company Focused on Copper Proposed Acquisition of Augusta February 10, 2014
Slide 2: Cautionary Notes
Cautionary Notes This presentation contains “forward-looking statements” and “forward-looking information” (collectively, “forward-looking information”) within the meaning of applicable Canadian and United States securities legislation. Forward-looking information includes information that relates t
Slide 3: Cautionary Notes (continued)
Cautionary Notes (continued) The full details of the offer by Hudbay to purchase all of the issued and outstanding common shares of Augusta (the “Offer”) will be set out in the takeover bid circular and accompanying offer documents (collectively, the “Offer Documents”), which Hudbay expects to file
Slide 4: Cautionary Notes (continued)
Cautionary Notes (continued) The scientific and technical information in respect of Hudbay contained in this presentation related to the Constancia project has been prepared by or under the supervision of Cashel Meagher, P.Geo., Hudbay’s Vice President, South America Business Unit. The scientific an
Slide 5: Transaction Rationale
Transaction Rationale Enhances Hudbay’s market position as a leading intermediate base metals company with world-class copper production growth Augusta’s Rosemont project is an attractive complement to Hudbay’s portfolio of low-cost, long-life assets The Rosemont project is an ideal fit with H
Slide 6: Transaction Summary
Transaction Summary Hudbay’s offer is attractive to Augusta shareholders • Acquisition of all of the issued and outstanding common shares of Augusta not currently held by Hudbay The Offer • 0.315 of a Hudbay share per Augusta share, representing total consideration of C$2.96 per share1 • Total enter
Slide 7: Augusta Aligns with Hudbay's Stated Growth Strategy
Augusta Aligns with Hudbay’s Stated Growth Strategy 1. Focus Geographically Located in an established, mining-friendly jurisdiction in the Americas with a long history of copper production 777 2. Focus Geologically Reed Lalor Porphyry deposit with similar scale and geological setting to Constancia 3
Slide 8: Compelling Value Proposition for Augusta Shareholders
Compelling Value Proposition for Augusta Shareholders Significant premium and participation in a leading intermediate base metals producer Hudbay’s offer provides a unique value proposition with Bid Premium as of February 7, 2014 a significant upfront premium and the potential for a 62% re-rating as
Slide 9: Proven Project Execution
Proven Project Execution Hudbay has an 87 year track record of building, operating and reclaiming mines • Well-established operation 777 • Stable and steady low-cost production Production • Production achieved in September 2013 Reed • Full production expected by H1 2014 • Phase 1 production achieved
Slide 10: Overview of Rosemont
Overview of Rosemont A quality project in a favourable jurisdiction Asset Highlights Location Map Located in Arizona – the 6th largest copper producing region globally Open pit project producing copper and molybdenum concentrates via flotation – similar mining, processing and scale to Constancia Aug
Slide 11: Copper Focused Growth
Copper Focused Growth1 Significant production growth supported by large reserve base Copper Production Growth Copper Reserve and Resource Growth2 350 (mm tonnes Cu) 300 1.0 250 Copper Production (kt Cu) 1.6 200 +106% in P+P 150 0.6 Reserves +570% 1.0 100 4.1 50 2.0 0 2013A 2014E 2015E Pro Forma Hudb
Slide 12: Leading Position vs. Intermediate Producer Peers
Leading Position vs. Intermediate Producer Peers1 Hudbay is uniquely positioned as a low-cost, high growth producer Market Capitalization Mineral Reserves $11.0 (US$bn) (mmt Cu) 19.8 $6.8 7.9 $2.8 $2.0 4.1 $1.7 $1.1 $0.9 2.1 2.0 $0.9 1.5 0.8 0.7 First Turquoise Lundin PF Hudbay Capstone Oz PanAust F
Slide 13: A Low-Risk Investment with Significant Copper Growth
A Low-Risk Investment with Significant Copper Growth Copper Reserve Contribution by Region Reserve Contribution by Commodity2 1,3 Hudbay Pro Forma 100% Hudbay 100% Current 63% Capstone 100% OZ Minerals 100% First Quantum 55% 45% Lundin 11% 89% Hudbay PanAust 100% 1, 3 Pro Forma 73% Turquoise Hill 10
Slide 14: Strong Financial Capacity
Strong Financial Capacity Well capitalized to complete construction at Constancia and advance Rosemont Hudbay Liquidity 1 Superior financial capacity to fund remaining capital spending at Constancia, Lalor, and Reed Total Current Liquidity of $1.4 billion Recently enhanced cash position with equ
Slide 15: Global Positioning on 2018E Cash Costs and Copper Production
Net Cash Costs (US$/lb Cu) Copper Production (bn lbs) $0.00 $1.00 $1.50 $2.50 $0.50 $2.00 0.0 4.0 1.0 2.0 3.0 Southern Cu Freeport Chinalco Source: Wood Mackenzie Codelco Russian Cu Glencore Hudbay (2018) BHP Hudbay (2018) PF First Quantum quartile costs Private Southern Cu MMG Rio Tinto Jiangxi Cu
Slide 16: Industry-Leading Base Metals Company
Industry-Leading Base Metals Company Hudbay is focused on leading growth supported by quality assets… Hudbay is a leading intermediate base metals mining company with world- class copper production growth • Global scale • Projected bottom quartile cash costs • Low capital and political risks • Long-
Slide 17: For more information contact
Constancia primary crusher For more information contact: Candace Brûlé Director, Investor Relations Tel: 416.814.4387 Email: candace.brule@hudbayminerals.com HBM
Hudbay Minerals — Merger or Acquisition (February 2014) on 6ix