Arc Minerals Ltd said it entered into an agreement with Anglo American PLC (LSE:AAL) to jointly develop Arc’s copper-cobalt project in the north-western province of Zambia.
Under the transformational deal for the AIM-traded company, Anglo American will have the right to retain a 70% ownership in the joint venture for a total investment of up to US$88.5mln, including up to US$14.5mln in cash.
"This agreement represents a major turning point for Arc and follows many months of negotiations,” said executive chairman Nick von Schirnding, who was previously a senior executive with Anglo American and De Beers.
“I am delighted to be signing this agreement with Anglo American which will, upon execution and completion of the definitive agreements, result in the potential for significant investment by a reputable major mining company in the tenements in north west Zambia and a very exciting time ahead for us."
Shares in Arc, which jumped as much as 40% to 6.3 pence today, were up 20% at 5.40p in mid-morning trading.