Commodities trader and miner Glencore will take Katanga Mining private, the Toronto Stock Exchange-listed subsidiary, which has operations in the Democratic Republic of Congo (DRC),the company said earlier this week.
Glencore International (GIAG) is taking Katanga private by way of an amalgamation of the company with 836074 Yukon.
Katanga has cited a lack of a meaningful public float and limited trading liquidity, the costs of a stock exchange listing, the premium being offered to shareholders, the current commodity price risks, the ongoing operational risks, the financial risks and the lack of sources of financing without support from GIAG as the reasons for the going-private transaction.
GIAG intends to vote all of its 60 870 439 243 common shares, representing about 99.5% of the issued and outstanding common shares, in favour of the amalgamation.
Meanwhile, Katanga reported that there had been no material disruptions to its productive operations during the first quarter, as a result of the COVID-19 pandemic, but cautioned that there could be no certainty that restrictive measures implemented by the DRC would not impact on its operations in the coming weeks and months.
Travel restrictions as a result of COVID-19 are impacting on Katanga’s projects. The company has delayed the commissioning of its acid plant at the Kamoto Copper Company (KCC) with commissioning expected in the second half of the year, rather than the first half.
In the first quarter, Katanga increased its copper cathode production to 67,298 tonnes, from 65,402 tonnes in the fourth quarter. Cobalt contained in hydroxide decreased from 6,174 tonnes in the fourth quarter, to 5,296 tonnes in the quarter under review.
The company’s guidance for 2020 is to produce 270,000 tonnes of copper and 26,000 tonnes of cobalt this year.