Teck purchased the QB2 minority interest (13.5%) in 2018.
The 2016 43-101 FS document below indicated an after NPV (8%) of $1,253M US and 11.7% IRR when using copper at $3.00 US, which in my opinion, was a good LT price back then.
https://www.miningdataonline.com/reports/Quebrada%20Blanca%20Phase%202_FS_02032017.pdf
Terms of the transaction:
Teck agreed to pay milestone payments.
- 52.5M US in cash at closing
- $60M US upon EA approval
- $50M US 30 days before first production
That's $162.5M US total for the 13.5% interest (valued at $169.2M US) or 96% of the NAV when using copper at $3.00 US.
Additionally, the minority interest had an option for Teck to pay up to $100M US additional, if copper stayed above $3.15 US during the first 3 years of production (with some conditions).
https://www.teck.com/news/news-releases/2018/teck-acquires-quebrada-blanca-minority-interest-
When looking at the sensitivity analysis, copper at $3.15 US increased the after-tax NPV (8%) to $1,659.5 M US.
Therefore, Teck was willing to pay up to $262.5M US for the 13.5% interest (valued at $224M US) or 117% of the NAV when using copper at $3.15 US.
Conclusion: Teck will pay between 96% and 117% of the after-tax NAV (8%) that was available at that time. The minority interest, at my knowledge, did not have a carried-interest to production, therefore, was possibly on the hook for 13.5% of the QB2 capex. With SC, we don't have this pressure, which in my opinion, warrants a premium.
IMO.
MoneyK
