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Canadian mine acquisition complete

Canadian mine acquisition complete


A Sydney-based Ashurst team has advised Champion Iron Limited on its acquisition of the Bloom Lake Mine in Canada.

Firms: Ashurst (Champion Iron Limited); McCarthy Tétrault (Cliffs Quebec Iron Mining)

Deal: Champion Iron Limited acquired assets from Cliffs Quebec Iron Mining through private placement and subsidiary fundraising.

Value: CAD$53.3 million acquisition, CAD$30 million placement and CAD$20 million subsidiary fundraising

Area: M&A

Key players: The Ashurst team was comprised of Sydney-based consultant Gary Lawler and senior associate Stuart Dullard.

Deal significance: Canadian mining company Champion Iron Limited (Champion), which is listed on both the Australian Stock Exchange and the Toronto Stock Exchange, acquired the Bloom Lake Mine, rail assets and quinto claims from Cliffs Quebec Iron Mining (Cliffs) for CAD$53.3 million.

To fund the acquisition, Champion conducted an underwritten private placement that raised CAD$30 million and introduced three new cornerstone investors (Wynnchurch Capital LLC, Resources Capital Fund and Resources Quebec).

The placement almost doubled Champion's capital base, according to a release from Ashurst, and was approved by shareholders under Listing Rule 7.1 on 31 March.

Resources Quebec is also investing CAD$20 million at the subsidiary level through a CAD$6 million loan and investing CAD$14 million in equity, giving it a 36.8 per cent interest in the holding company of the assets.

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