(Yicai Global) Sept.6 --Zijin MiningGroup, a Chinese non-ferrous metals producer, has agreed to acquire Nevsun Resources foralmost CAD1.84 billion (USD1.4billion) in cash, gainingthe Canadian miner's rightstoseveral metal mines in Africa and Europe.

The parties signedthe deal yesterday, Xiamen-based Zijin said in a statement the same day. A wholly owned unit will buy all of Vancouver-based Nevsun's 302.6 million shares outstanding and other equity for CAD6(USD4.60) apiece, representing a 21 percent premium on the Sept. 4 closing price.

The offer price is also 26percent higher thanthe CAD4.75a shareToronto-based Lundin Mining proposed in a hostile takeover bid launched on July 26, which Nevsun fended off, the statement added.

Zijin International Finance, run by the Chinese miner's affiliate, already holds over 3.19 millionshares in Nevsun, meaning the offer totals CAD1.84 billion exclusive of these, the statement added. The share transfer isset forNovemberafter allthe deal's conditions are satisfied. The agreement also containsalock-upclauseon shares held by Nevsun's directors and management.

If Nevsunultimatelyacceptsan offer from anotherfirm, it will pay aUSD50 million penaltyto Zijin under the agreement. But if the Chinesegovernment withholds approval and thedeal fails to wrap up byJan. 31, Zijin will pay Nevsun USD50 million.

Copper and Gold Mines

Nevsun Resources trades on the Toronto [TSX:NSU] and New York [NYSE:NSU] stock exchanges. The miner explores for and develops copper, zinc, gold and other mineral resources. Its two flagship projects are the Bisha zinc-copper project in Eritrea, of which it owns 60 percent, and the Timok Project, a high-grade copper-gold development in Serbia. It boasts a total of 27 exploration rights in Serbia, Macedonia and Eritrea, the statement said.

The Serbian project includes a 100percentinterest inahigh-grade copper-gold mine and a 60.4percentinterest inalarge-scale porphyry copper mine, the statement said.

The Bisha copper-zinc mine, Nevsun'sonly operational project,has limited profitability. The company's profitability will improveas soon asthe Timok copper-gold mine is put into production,the statement added.

Zijin Mining hasbeenactiveinacquiringoverseas resources.The Serbian government willissue formal confirmation letters and invitations tothe firm, whichis expected to invest in the Serbian state-owned copper mine RTB BorGroupand become its new controlling shareholder, itannounced earlier this week.

Zijinhasoffered toinfusenearlyUSD1.5 billion intothe country'slargest mining and smeltingfirmover six years,theSerbianenergy and mining ministryannounced last week, Bloomberg reported.

Editor: Ben Armour