Avanco Resources Limited is an emerging mid-tier copper producer situated in Brazil
Following a comprehensive benchmarking of global development-stage copper projects undertaken in 2013, the Appian team successfully identified Avanco Resources as a unique investment opportunity. At the time, the company’s flagship asset, Antas North, was one of the highest grade undeveloped copper projects in the world, with significant potential for scale and growth supported by regional satellite exploration targets, and the nearby Pedra Branca deposit. Additionally, Avanco’s management team had successfully accumulated the second largest land package within the highly prospective Carajas region of northern Brazil. Near term production at Antas North with expansion potential combined with significant exploration upside and a strong management team, led to the formation of Appian’s investment thesis.
Following the maiden investment in June of 2014, Appian, along with Avanco’s other major shareholders, supported the company from greenfield development to production within less than 24 months. Given the uniqueness of Avanco’s deep project pipeline and the scarcity of assets similar to Antas North, Appian was confident that the company would be a high priority target following an uptick of M&A activity in the mining sector amid a market recovery. Appian’s thesis has proven to be correct as OZ Minerals recently announced a friendly takeover offer for Avanco, which represented a 121% premium to the company’s previous trading price. Appian was in favour of the takeover and is confident that the OZ Minerals team will successfully extract significant value from Avanco’s suite of high quality assets.