Lundin Mining to buy one of Yamana Gold's copper mine in Brazil

FILE PHOTO: Visitors to the Yamana Gold mining company booth speak with representatives during the Prospectors and Developers Association of Canada (PDAC) annual convention in Toronto, Ontario, Canada March 4, 2019. REUTERS/Chris Helgren

(Reuters) – Lundin Mining Corp said on Monday it would acquire a gold-copper mine of Yamana Gold Inc in Brazil for more than $1 billion as it looks to beef up its base metals portfolio.

U.S.-listed shares of Yamana Gold were up 7.4 percent at $2.75 before the bell.

The Chapada mine, in northwest of Brazil, began production in 2007 and is expected to produce about 54,500 tonnes of copper and 100,000 ounces of gold in 2019.

Lundin said the deal would immediately add to its earnings and operating cash flow per share, while boosting its annual copper production by over 25 percent.

Yamana will receive $800 million in cash, and contingent payments totaling about $225 million, the companies said.

Lundin, which primarily mines copper, nickel and zinc in Chile, the United States, Portugal and Sweden, said it would fund the purchase from its current cash balance and a part of its $550 million revolving credit facility.

Reporting by Arundhati Sarkar in Bengaluru; Editing by Anil D’Silva