TSX-listed Arizona Sonoran Copper Company has filed the necessary management information and related proxy materials ahead of a special meeting of shareholders on May 11 to vote on a proposed plan of arrangement with Canadian base and precious metals producer Hudbay Minerals.

Hudbay intends to acquire all of the issued and outstanding common shares of Arizona it does not already own, whereby each Arizona shareholder will receive 0.242 of a Hudbay share for each common share held in Arizona.

Arizona also advises that the Supreme Court of British Columbia has granted an interim order in respect of the arrangement that authorises the holding of the meeting, while the TSZ and Commissioner of Competition have relased approvals for the arrangement.

The arrangement is expected to close in the second quarter of the year, subject to shareholder approval.

Should the arrangement proceed, it would result in Arizona becoming a wholly-owned subsidiary of Hudbay and existing shareholders owning about 11% of Hudbay.

The consideration implies a value of $9.35 per common share.

The arrangement will provide increased exposure to a divserified and high-quality asset portfolio owned by Hudbay, with priority shareholders being able to retain exposure to the Cactus project, in Arizona. The Cactus project spans an area of 3 174 ha that is prospective for copper.

Arizona says the arrangement will also offer reduced execution and financing risk for the Cactus project if it is to come under ownership of Hudbay, given the group’s well-capitalised balance sheet and ability to generate meaningful cashflow.

Arizona motivates that Hudbay is a well-established operating company listed on both the TSX and NYSE, with existing Arizona shareholders poised to gain ownership in a larger, more liquid operating company with broader analyst coverage, enhanced access to capital markets and consistent dividend payments.

The board and independent advisers have recommended that Arizona shareholders approve the arrangement, saying that it is in the best interest of the company and is fair to shareholders.

Shareholders collectively holding 30% of Arizona’s stock have already indicated they will vote in favour of the arrangement at the meeting.