OSC Overturns TSX Decision - Requires Shareholder Approval Based On Fairness Concerns

On January 23, 2008, the Ontario Securities Commission issued its decision In the Matter of HudBay Minerals Inc., setting aside a prior decision of the Toronto Stock Exchange and requiring approval by the shareholders of HudBay Minerals Inc. of the company's proposed acquisition of Lundin Mining Corporation. Though issued on an expedited basis with full reasons to follow, the Commission's decision is significant not only because it is rare for the Commission to set aside a decision of the TSX, but also because it significantly alters the landscape for TSX-listed issuers using their listed securities as currency in acquisition transactions.

Background

On November 21, 2008, HudBay and Lundin announced that they had agreed to a business combination whereby HudBay would acquire all of the outstanding common shares of Lundin in exchange for common shares of HudBay by way of a plan of arrangement (the "Transaction"). As a result of the Transaction, HudBay would issue an