Katanga Mining Ltd agreed a friendly deal to buy rival Nikanor plc on Tuesday to forge a major copper alliance in the Democratic Republic of the Congo (DRC), boosting Nikanor shares sharply.

Nikanor shares had jumped 10.54% to 650.5 pence by 1430 GMT, outperforming a 3.2% rise in the UK mining index.

Under the deal, Canadian-listed Katanga will make an offer for London-listed Nikanor, whose investors will end up owning 60% of an enlarged company with market capitalisation worth about $3.3 billion.

Both companies are developing copper/cobalt mines in the DRC, in the same area near the town Kolwezi in the southeastern copperbelt region.

"The merger is expected to deliver significant value enhancement for shareholders of both companies resulting from capital savings, lower unit operating costs and increased production," a statement said.

Nikanor said the merger would be implemented by way of an offer by Katanga for Nikanor together with a cash return to Nikanor shareholders of US$452 million.

Investors in Nikanor will receive 0.613 of a new Katanga share and $2.16 cash for each Nikanor share.

Katanga said it had received irrevocable undertakings to support the merger from shareholders representing 78.4% of Nikanor shares, including Swiss-based commodities trader Glencore.