The Chinese Jiangxi Copper Company buys shares in First Quantum

1,760Views 0Comments Posted 03/03/2024

The Chinese transaction included the purchase of 25.9 million shares of First Quantum at a unit price of 11.10 Canadian dollars.  They are based in China and are the second largest shareholder of First Quantum Minerals Ltd.   The new acquisition of shares in the Canadian metals producer totals 287.5 million Canadian dollars (equivalent to 212 million US dollars).  This purchase takes on special relevance at a crucial time for First Quantum, as the company has been affected by the forced closure of its flagship copper mine in Panama. 

The closure was a consequence of a court ruling that declared the legal contract between the State and the company unconstitutional.  Faced with challenges resulting from the decommissioning of the Cobre Panamá mine, the Vancouver-based Canadian company has taken refinancing steps, including a successful share purchase offering that generated $1.55 billion last month.  The purpose is to strengthen First Quantum's financial position in this critical period. 

First Quantum will also ask Panama in an international arbitration for $20 billion as the mining company decided to launch a visitor and citizen participation program.  The company's main argument is that Panama ordered the closure of the Donoso copper mine after a ruling by the Supreme Court of Justice, which declared the legal contract between Minera Panamá and the Panamanian State unconstitutional.  First Quantum supposedly lost more than half of its market value after the contract law was declared unconstitutional on November 27.