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HudBay Minerals Inc
Symbol HBM
Shares Issued 193,021,710
Close 2014-07-02 C$ 10.28
Market Cap C$ 1,984,263,179
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HudBay Minerals files revised Augusta takeover offer

2014-07-02 16:51 ET - News Release

Also News Release (C-AZC) Augusta Resource Corp (2)

An anonymous director reports

HUDBAY AND AUGUSTA ANNOUNCE FILING OF OFFER DOCUMENTS FOR FRIENDLY ACQUISITION

HudBay Minerals Inc. has filed its notice of variation and extension, and Augusta Resource Corp. has filed its notice of change to directors circular, in connection with Hudbay's revised offer to acquire all of the outstanding common shares of Augusta not already owned by Hudbay or its affiliates, for consideration per Augusta share of 0.315 of a common share of Hudbay and 0.17 of a warrant to acquire a common share of Hudbay. As previously announced, Augusta's board of directors is unanimously recommending that Augusta shareholders accept the revised offer and has agreed to terminate Augusta's shareholder rights plan to permit shareholders to do so.

Hudbay's notice of variation and extension

Pursuant to the terms of the notice of variation and extension, Hudbay, among other things, has increased the consideration offered per Augusta share of 0.315 of a common share of Hudbay to include 0.17 of a warrant to acquire a common share of Hudbay, and extended the period of acceptance of the revised offer to 5 p.m. (Toronto time) on July 16, 2014.

Augusta's notice of change to directors circular

The board of directors of Augusta has filed a notice of change to directors circular that indicates that the Augusta board of directors is unanimously recommending that Augusta shareholders accept the revised offer and tender their Augusta shares to the revised offer. This decision follows a unanimous determination, made by the Augusta board of directors that, after consultation with its financial and legal advisers, the consideration under the revised offer is fair from a financial point of view, to Augusta's shareholders (other than Hudbay and its affiliates), and that it would be in the best interests of Augusta to support and facilitate the revised offer. Augusta's financial advisers, Scotia Capital Inc. and TD Securities Inc., have each provided opinions to the Augusta board of directors that, as of June 22, 2014, and subject to the assumptions, limitations and qualifications on which the opinions are based, the consideration to be received under the offer is fair, from a financial point of view, to Augusta's shareholders other than Hudbay and its affiliates.

All of the directors and officers of Augusta, and certain other Augusta shareholders, have entered into agreements with Hudbay pursuant to which, among other things, they have agreed to tender to the offer all of the Augusta shares owned or controlled by them (including Augusta shares issuable on the exercise of stock options and other convertible instruments). Those Augusta shares represent approximately 33 per cent of Augusta shares on a fully diluted basis.

About the revised offer

The full details of the revised offer are set out in the offer documents, which have been filed with the Canadian securities regulatory authorities and are being mailed to Augusta shareholders. The documents will also be available on SEDAR under Augusta's profile. Upon filing, the revised offer will be open for no fewer than 10 business days and, following any take-up of Augusta shares, Hudbay will then further extend its offer for at least an additional 10 days in order to allow any remaining Augusta shareholders to tender to the revised offer.

Hudbay has filed a registration statement on Form F-10, which contains a prospectus relating to the offer and a tender offer statement on Schedule TO with the U.S. Securities and Exchange Commission. This news release is not a substitute for the offer documents, the prospectus, the registration statement or the Schedule TO, or Augusta's tender offer solicitation/recommendation statement on Schedule 14D-9, as amended. Augusta shareholders and other interested parties are urged to read these documents, all documents incorporated by reference, all other applicable documents and any amendments or supplements to any such documents when they become available, because each will contain important information about Hudbay, Augusta and the offer. Materials filed with the Canadian securities regulatory authorities are available electronically without charge on SEDAR. Materials filed with the SEC are available electronically without charge on the SEC's website.

Hudbay owns 23,058,585 Augusta shares, representing approximately 16 per cent of the issued and outstanding Augusta shares. In addition, and in accordance with U.S. tender offer rules, Hudbay discloses that as of 5 p.m. on June 30, 2014, 11,609,261 Augusta shares, representing approximately 8 per cent of the issued and outstanding Augusta shares, had been tendered to and not withdrawn from the revised offer.

How to tender

Augusta shareholders that have already deposited to the offer should not withdraw their shares. Augusta shareholders are encouraged to read the full details of the revised offer set forth in the offer documents, which contain detailed instructions on how Augusta shareholders can tender their Augusta common shares to the revised offer. For assistance in depositing Augusta shares to the revised offer, Augusta shareholders should contact the depositary for the offer, Equity Financial Trust Company, at 1-866-393-4891 (North American toll-free) or 416-361-0930 extension 205 (outside North America), or by e-mail. Shareholders can also contact the information agent for the offer, Kingsdale Shareholder Services, at 1-866-229-8874 (North American toll-free number) or 1-416-867-2272 (outside North America), or by e-mail.

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