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London Evening Standard - 2021-11-25

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Hochschild shares bounce back after Peru U-turn on shutting silver mines

Business

Simon Freeman @SimonjFreeman

MINING group Hochschild’s shares today rebounded by more than 25% after Peru’s government reversed a ruling to shut down two of its biggest silver mines. The U-turn was welcomed by the FTSE 250-listed group’s CEO Ignacio Bustamante, who branded a move to accelerate the closure of its Inmaculada and Pallancata operations in the Andean region of Ayacucho “illegal”. The announcement by Peru’s newly installed prime minister Mirtha Vásquez wiped almost £500 million from Hoschshild’s market value within minutes of trading opening in London on Monday. Today, following what the firm called “discussions between senior members of the Cabinet and representatives from the mining industry”, she appeared to row back saying there would be no “unilateral shutdowns”. Shares were back up to 150p having sunk as low as 70p. Jitters have run through Peru’s mining sector since rural union activist Pedro Castillo was installed as president in the spring with a pledge to raise taxes and nationalise the industry to fight poverty. Bustamante said: “We are pleased that our Inmaculada and Pallancata mines can continue to operate without further uncertainty and, furthermore, we reaffirm our goal to increasing our resources and extending our mine lives, in accordance with current legislation.”

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