Boliden’s $1.3B Nexa buy adds S-American zinc, silver

Sweden’s Boliden (STO: BOL) has agreed to buy Brazilian conglomerate Votorantim’s controlling stake in Nexa Resources (NYSE: NEXA) for $1.3 billion (C$1.8 billion) in shares, giving the European miner a major zinc and silver platform in Latin America.

Boliden will acquire Votorantim’s 65% stake by issuing 0.25 of one of its shares for each Nexa share, implying a price of $15.29 per Nexa share, the companies said Thursday. After closing, Boliden has agreed to launch a cash tender offer for the remaining 35% within 30 days, or 60 days in some circumstances. The price will be based on the same exchange ratio and Boliden’s 20-day average share price before closing.

“The transaction will reinforce our standing as a globally important base metal producer and bring a healthy addition to our precious metal business with a large increase to our output of silver in concentrate,” Boliden CEO Mikael Staffas said in a release. “Furthermore, Boliden’s and Nexa’s combined project portfolio will be highly attractive and present a solid foundation for future growth.”

The acquisition follows Boliden’s $1.4-billion purchase last year of the Neves-Corvo copper-zinc mine in Portugal and Zinkgruvan zinc mine in Sweden from Lundin Mining (TSX: LUN). That April 2025 deal nearly doubled Boliden’s zinc concentrate production and significantly increased its copper output.

Brazil, Peru

Nexa operates five polymetallic mines and three zinc smelters in Brazil and Peru. Its mines are Cerro Lindo, El Porvenir and Atacocha in Peru and Vazante and the ramping-up Aripuanã operation in Brazil. Its smelters include Cajamarquilla in Peru, the largest zinc smelter in the Americas, and Três Marias and Juiz de Fora in Brazil.

BMO Capital Markets mining analyst Alexander Pearce estimates Nexa would add about 240,000 tonnes of attributable mined zinc, 18,000 tonnes of copper and 7 million oz. silver to Boliden in 2027. That would increase Boliden’s forecast mined zinc production by 62%, copper by 14% and silver by 64%.

Once the transaction closes, Boliden and Nexa would together operate 12 mining units and eight smelters across Europe and Latin America. On a combined basis, the companies generated about SEK136 billion ($14.3 billion) in revenue and SEK38 billion in earnings before interest, taxes, depreciation and amortization during the 12 months ended June 30. Boliden estimates the transaction would immediately increase earnings per share by more than 8%.

The acquisition would also increase Boliden’s net debt-to-equity ratio to about 33% from 24% on a pro forma basis. The company has secured a $2-billion bridge facility that can be used to fund the tender for remaining Nexa shares, mandatory offers for minority interests in some Peruvian subsidiaries and potential refinancing at Nexa.

BMO said the valuation looks attractive at first glance. The implied price represents about 3.2 times Nexa’s average forecast 2027-28 enterprise value to earnings before interest, taxes, depreciation and amortization, compared with Boliden at about 5 times. BMO forecasts Nexa to generate $1.1 billion and $1.3 billion in earnings before interest, taxes, depreciation and amortization in those years.

“However, while this does add significant production, meaningful synergies aren’t immediately obvious and adds to complexity of its integrated business,” Pearce said in a note. BMO rates Boliden Market Perform with a SEK575 target.

Premium

The $15.29-per-share consideration represents a 14% premium to Nexa’s 20-day volume-weighted average price on July 1, the last trading day before reports of talks between Boliden and Votorantim surfaced. It is a 6.5% premium to Nexa’s 20-day average through Wednesday. Nexa shares closed Wednesday at $15.58.

Votorantim will receive 21.4 million newly issued Boliden shares and own about 7% of the Swedish company after closing. The deal values all of Nexa at about $2 billion in equity and $3.7 billion including debt and other obligations. Votorantim will also have the right to nominate a representative to Boliden’s board.

Boliden shares fell after the announcement in Stockholm, trading around SEK571 on Thursday, about 2.1% below Wednesday’s close of SEK583.40.

The transaction is expected to close in the first quarter of 2027, subject to approval by Boliden shareholders and regulators. Boliden expects four of Nexa’s seven directors to be affiliated with it after closing. Nexa will remain separately listed on the New York Stock Exchange, with most of its existing management expected to remain in place.