TORONTO (miningweekly.com) – Latin American precious metals miner Hochschild Mining on Wednesday said it planned to buy the remaining 40% interest in its Peruvian assets for about $280-million.

To achieve this, the company intended to raise up to $96-million to help it buy-out International Minerals, which holds the remaining interest in the Pallancata mine and the Inmaculada project.

Hochschild CEO Ignacio Bustamante said the transaction represented an important opportunity to increase the company’s exposure to the southern Peru cluster, reduce its overall operating cost position, and potentially enhance its cash flow generating potential at no additional ongoing administrative cost.

The LSE-listed company said it planned to raise between $48-million and $96-million in an equity placing to partially fund the acquisition.

In the event, a total of 29-million new ordinary shares of £0.25 each in Hochschild were placed by Goldman Sachs International and Merrill Lynch International at a price of £1.55 apiece, raising gross proceeds of about $72.8-million.

"We are excited to be announcing today a strategic milestone for Hochschild by consolidating ownership in Pallancata, currently our biggest cash flow generator, and Inmaculada, our most exciting growth project," Bustamante added.

The company said its other growth project, Crespo, would be deferred as it focused its capital expenditure on the Inmaculada project.

Hochschild said as a first stage of a broader corporate refinancing initiative, it had raised commitments for a $340-million acquisition bridge financing facility subject to cancellation of the $140-million Suyamarca loan facility; and was undertaking an equity placing to institutional investors, including Eduardo Hochschild, of between 4.99% and 9.99% of Hochschild’s outstanding share capital, representing about $48-million to $96-million.

Hochschild, which also has projects in Argentina and Chile, stated that it remained on track to produce 20-million attributable silver-equivalent ounces in 2013.