Hudbay Minerals (HBM) M&A announcement summary

Deal rationale and strategic fit

• Acquisition creates the third largest copper district in North America, consolidating two large-scale, complementary copper projects in Arizona and establishing a major copper hub that enhances exposure to copper growth opportunities and strengthens the U.S. critical minerals supply chain.

• Positions the combined entity as a leading Americas-focused copper producer with a robust pipeline of long-life, low-cost assets in top jurisdictions, supporting domestic refined copper supply.

• Provides Arizona Sonoran shareholders with immediate premium and continued exposure to long-term project upside through ownership in a larger, diversified platform.

• Offers a clear path to scale annual copper production from approximately 125,000 tonnes to over 250,000 tonnes by 2030, with potential to exceed 350,000 tonnes.

• Strengthens competitive advantage and capital markets profile with increased liquidity and analyst coverage.

Financial terms and conditions

• Arizona Sonoran shareholders receive 0.242 Hudbay shares per share, implying C$9.35 per share and a 30% premium to the last closing price.

• Equity value of the transaction is approximately US$1,480 million; enterprise value to Hudbay is US$1,278 million after accounting for existing ownership.

• Post-transaction, Hudbay and Arizona Sonoran shareholders will own approximately 89% and 11% of the combined company, respectively.

• Includes customary deal protections, non-solicitation, right to match superior proposals, and a termination fee.

• Transaction expected to close in Q2 2026, subject to shareholder, regulatory, court, and stock exchange approvals.

Synergies and expected cost savings

• Creation of an Arizona operating hub enables shared technical and support functions, centralized permitting, and development activities.

• Anticipated corporate synergies of US$5–10 million annually through reduced G&A, enhanced commercial terms, and shared infrastructure.

• Regional purchasing power, tax efficiencies, and pooling of tax losses expected to drive further cost savings.

• Stable, long-term sulfuric acid supply from internal production will reduce reagent cost volatility.

• Redeployment of construction teams and centralized Arizona head office to optimize project execution.