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QUADRA and FNX Merge to Create New Leading Intermediate Copper Producer

Published: 06/14/2010

By Robert B. Cohen, Jay Goldman, Chris Hersh, Christopher B. Norton, Alexander Pizale, Michael Platt, Jeffrey P. Roy, Ken Snider

On May 21, 2010 Quadra Mining Ltd. and FNX Mining Company completed a widely reported merger of the two companies to create a new leading intermediate copper producer. The combined company, the first significant new Canadian mining company in some time, is named Quadra FNX Mining Ltd. and trades under the symbol QUX. 

The merger was structured as a court-approved plan of arrangement under the Business Corporations Act (Ontario) pursuant to which Quadra has acquired all of the issued and outstanding common shares of FNX. Under the terms of the Transaction, former shareholders of FNX received 0.87 common shares of Quadra FNX and $0.0001 for each common share of FNX, subject to adjustment for fractional shares. Outstanding options and warrants to acquire FNX shares have been converted into options and warrants to acquire Quadra FNX shares, adjusted in accordance with the same exchange ratio. FNX has been delisted from the TSX.

Quadra FNX has a market capitalization of $2.2 billion, a treasury of approximately US$600 million, and minimal debt. Quadra FNX is expected to produce an estimated 300 million pounds of copper and 150,000 ounces of platinum group metals in 2010 from its five producing mines and possesses several advanced development projects, including the Sierra Gorda copper-molybdenum project in Chile, the Morrison Deposit in Sudbury, and the Malmbjerg molybdenum development project in Greenland. The company employs approximately 1,650 people in North and South America.

Cassels Brock acted for FNX Mining with a team that included Jay Goldman (Securities, Mining and Mergers & Acquisitions), Jeffrey Roy (Securities and Mergers & Acquisitions), Norman Findlay (Securities, Mining and Mergers & Acquisitions), Alex Pizale (Securities), Jelena Novikov (Securities and Mergers & Acquisitions), Chris Hersh (Competition), Robert Cohen (Litigation), Ken Snider (Tax), Chris Norton (Tax) and Michael Platt (Tax).