(Yicai Global) Sept. 18-- Zijin Mining Group hasstruck a dealwith Serbia,it announced yesterday. It will invest USD350 million within three years to increase its investment in RTB Bor. Zijin Mining Group will hold63 percent of the mining concern's equity after the investment.

RTB Bor will spendUSD1.26 billion (including the USD350 million) withinsix years ontechnological transformation, expandingits smelting plant and fourmines,andnew construction.

The acquisition ofRTB Bor proceeded smoothly asZijin Mining Group agreed to assume 90 percent of its debts (aboutUSD1.4 billion), New York-based Fitch Ratings, one of the Big Three credit rating agencies, stated in a report released yesterday.

RTB Bor is a state-owned copper mining and smelting conglomerate. TheRepublic of Serbia Development Fund and its sovereign equity fund hold 99.99percent ofits equity. RTB Bor owns the only copper ore and smelting plant in production in Serbia, which is endowed with a large amount of copper ore resources, all large porphyry deposits suitable for large-scale extraction. RTB Bor's copper mines liein the renowned Eurasian Metallogenic Belt and have good miningprospects.

Xiamen, Fujian province-based Zijin Mining Group toppedSerbia'spublic tender process which sought tointroduceinvestors toreorganizethe target.

Zijin Mining Grouprecently went on to acquire overseas mining assets with a renewed momentum after a series of mergers and acquisitions in Africa and Australia.

Zijin Mining Group has also struck a deal withNevsun Resources, a mid-tier listed Canadian mining company, on Sept. 5 ona cash takeover bidpriced atCAD6 (USD4.60) per share and a total of CAD1.86 billion (USD1.4 billion). Zijin Mining Group sent the bidto all shareholders of Nevsun Resources through its overseas uniton Sept. 15.

The initial deadline for theTOB is Dec. 31 and itsmain conditionsarethat two-thirds of the shares issued by Nevsunmust accept it,no significant adverse change occurs withNevsunand theTOB winsapproval from both Chinese and Canadian regulators.

Nevsun Resources also holdsa 60 percent stake in the Bisha Copper Minein the Horn of Africa nation of Eritrea. The company further owns 100 percent and 46 percent of the equity inthe upper and the lower mining area ofSerbia'sTimok Copper-Gold Project, whose upper area may contain 27 million tonsof first-class copper ore.

Greaterdemand forcopper will arise tomakewires and cables asmore vehicles utilizenew energies andwith ever-increasingdemand forpower generation. Large miners have publicly expressed their desire toincreasecopperoutput.

The acquisition by Zijin Mining Group will notadversely influence the company's credit rating becauseit operates welland smoothlywith annual cash flow of CNY8 billion (USD1.18 billion),Fitch Ratings said yesterday, butthe acquisition will raise the leverage ratio of the company in theshortterm, it added.

Editor: Ben Armour