ACG Electric Metals

2023: Artem Volynets acquires two mines in Brazil

Specialized company for targeted mergers and acquisitions (SPAC) ACG of Russian businessman Artem Volynets has agreed to acquire two mines in Brazil for $1 billion. These transactions became known on June 12, 2023.

According to Kommersant, ACG acquires the Santa Rita nickel mine and the Serrote copper mine from private equity funds advised by Appian Capital. In the future, nickel sulfide and copper concentrate from these mines will be supplied for processing to Europe and North America, and then to automakers for the production of electric vehicles.

Artem Volynets

According to Bloomberg, the deal will be supported by global mining company Glencore, carmaker Stellantis (parent company of Chrysler, FIAT and Peugeot), mining investment fund La Mancha Resource Capital and PowerCo (battery division of Volkswagen). The first three companies will provide ACG equity investments of $100 million each, and PowerCo will make an advance payment of $100 million per nickel. The creditors of the transaction are Citigroup, ING and Societe Generale, which in total issued loans in the amount of $300 million.

These high-quality mines will allow ACG to become the preferred supplier of environmentally friendly metals for Western electric car manufacturers, "said Artem Volynets, a former head of En + Group (the parent company of Rusal Oleg Deripaska).

Being a SPAC-format company (special purpose acquisition company, which is originally intended to merge with a non-public company for the latter to go public), ACG Acquisition will change its name after the transaction and become ACG Electric Metals.

The cost of production in Brazil is 1.5-2.5 times higher than in Russia, independent industrial expert Maxim Shaposhnikov told the newspaper. Nevertheless, capital expenditures in Brazil are significantly lower, so the project has every chance of paying off, despite the low nickel content in the ore at 0.31%.^[1]

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