2-Nyrstar to buy Breakwater for $639 million
Wed Jun 15, 2011 5:17am EDT
BRUSSELS, June 15 (Reuters) - Belgium-based Nyrstar (NYR.BR), the world's biggest zinc producer, is buying Canadian group Breakwater (BWR.TO) for C$619 million ($639 million), part of a strategy to buy more mines to increase self-sufficiency.
Nyrstar said on Wednesday it will pay an agreed C$7.00 per share and Breakwater shareholders will also get a special dividend of C$0.50. Overall the deal is worth C$663 million to Breakwater shareholders including the dividend.
The acquisition will increase the percentage of zinc Nyrstar gets from its own mines to 43 percent from 31 percent, bringing it closer to its medium-term target of 50 percent.
Shares in Nyrstar increased by as much as 5 percent following the announcement to a high of 9.19 euros per share.
"We estimate this transaction to be highly earnings and value accretive," said KBC Securities in a note to clients.
The broker reiterated its "buy" rating and said its 11.50 euros per share target price was under upwards revision.
In February Nyrstar launched a 490 million euro ($708.5 million) rights issue so it could buy in more mines. [ID:nLDE71M0UV] (Editing by Erica Billingham and Mike Nesbit) ($1=.9687 Canadian Dollar=.6916 euros
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