Hudbay increases pressure in hostile takeover bid claiming “Augusta continues to mislead shareholders”


Hudbay Mineral Resources is stating in U.S. and Canadian regulatory filings that Augusta Resource Corporation is misleading its shareholders in its financial statements concerning the financing, permitting and construction timeline for Augusta’s proposed Rosemont copper project.

“Augusta continues to mislead shareholders,” Hudbay states in an April 14 filing with Canadian regulators and the U.S. Securities and Exchange Commission. There is “no reasonable prospect of Augusta being fully-financed and commencing construction in mid-2014.”

HudBay’s filing comes at the some time the Toronto-based mining company filed a request with the British Columbia Securities Commission to terminate Augusta’s “poison pill” shareholders protection plan designed to thwart Hudbay’s hostile takeover that was launched on February 9. Continue reading

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Augusta again urges shareholders to reject HudBay bid claiming it is on the “cusp” of receiving final permit

Augusta Resource Corporation is continuing the mantra in its annual proxy statement released last week that the final major permit for its Rosemont copper project will be issued before July and that construction will begin later this year.

And, once again, Augusta’s Board of Directors urges shareholders to reject an unsolicited takeover offer from HudBay Minerals Inc.

Vancouver, B.C.-based Augusta continues to state in filings to Canadian and U.S. regulators that it is “confident” the U.S. Army Corps of Engineers will issue a Clean Water Act 404 permit by the end of the second quarter to its Rosemont Copper Company subsidiary, despite serious concerns the Corps raised in February about Augusta’s permit application.

Augusta’s April 7 proxy, formally known as the Management Information Circular (MIC), is the fourth consecutive regulatory filing the Company has made without disclosing a Feb. 28 Army Corps letter sent to Rosemont president Rodney Pace. Continue reading

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Groundwater depletion caused by Rosemont mine would negatively impact more than 900 private wells

SSSR14_1014_Pages from rosemont-feis-vol-1There is no adequate mitigation plan to address the proposed Rosemont copper mine’s massive and permanent impact on groundwater supplies that provide domestic water to more than 900 privately-owned wells on the east and west side of the Santa Rita Mountains, according to written objections to the Coronado National Forest’s Final Environmental Impact Statement.

“The USFS continues to avoid the bottom line issue of what are the likely impacts of groundwater pumping by the Rosemont Copper Project on individual home owners, existing businesses, and communities,” the objections state.

The FEIS, the objections state, failed to provide a “quantitative or even a qualitative analysis of a reduction in groundwater availability nor any socioeconomic analysis of the effect of groundwater mining on existing well owners.”

The objections were prepared by a citizen’s coalition opposed to the mine and were filed with the U.S. Forest Service Regional Forester, who must respond in writing by the end of April. If the objections are not adequately addressed with substantive changes to mining plans, the issues could be used in potential litigation against the Forest Service that could block construction of mine. Continue reading

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Augusta ignores Army Corps concerns and continues to tell investors 404 Clean Water Act permit will be issued by June 30

Augusta Resource Corporation continued to state in regulatory disclosures filed late Monday that it expects its Rosemont Copper Company subsidiary to receive a crucial Clean Water Act permit from the U.S. Army Corps of Engineers by June 30.

The Section 404 permit is necessary before construction can commence on its Rosemont copper project. Augusta’s assurances that permitting will be complete by the end of the 2nd Quarter comes as the company is fending off a hostile take over from much larger HudBay Mineral Resources.

HudBay announced Monday it is extending its takeover deadline to May 5. HudBay already controls slightly more than 15 percent of Augusta’s stock and is seeking to purchase the remaining outstanding shares in a deal worth approximately $540 million.

Vancouver, B.C.-based Augusta has repeatedly urged shareholders to reject the HudBay offer because it expects to receive final permits clearing the way for the Rosemont project that will trigger a substantial increase in the value of the company. Augusta, while continuing to state on its website it intends to construct the Rosemont mine, is also stating it is in discussions with nine companies interested in bidding for Augusta.

Augusta, however, has not informed investors in three separate disclosure reports about a Feb. 28 Army Corps letter that raised serious concerns about Rosemont’s failure to provide a mitigation plan to compensate for damage to Waters of the United States (WUS) from its proposed open-pit copper mine that meets federal regulations. Continue reading

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April 1 deadline for Rosemont to submit suitable mitigation plan required for crucial water permit

Despite two years of regular meetings and discussions between Rosemont Copper Company and the U.S. Army Corps of Engineers, Rosemont has yet to submit a mitigation plan that meets federal requirements, the Corps stated in a Feb. 28 letter to the company.

As a result, Rosemont is facing an April 1 deadline to submit a suitable mitigation plan to the Corps that is necessary before the Corps can issue a Section 404 Clean Water Act permit the company needs to construct the proposed Rosemont open-pit copper mine.

The Corps stated that Rosemont has failed to provide a plan that focuses on restoration and enhancement of watersheds to compensate for the destruction of about 70 acres of wetlands that will occur by the proposed massive open pit mine that will destroy more than 3,000 acres of Coronado National Forest (CNF).

Rosemont President & CEO Rod Pace said the company disagrees with the Corps statements about the lack of restoration lands in its proposal, according to an Arizona Daily Star March 22 story. The company declined to provide specifics in response to a question from the Star. Continue reading

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