Hudbay and Augusta Announce Transaction to Effect Amalgamation and Mailing of Circular

TORONTO, ONTARIO--(Marketwired - Aug. 25, 2014) - HudBay Minerals Inc. ("Hudbay") (TSX:HBM) (NYSE:HBM) and Augusta Resource Corporation ("Augusta") (TSX:AZC) (NYSE MKT:AZC) announced today that they have entered into an agreement to effect an amalgamation (the "Amalgamation") of Augusta and an indirect, wholly-owned subsidiary of Hudbay as a result of which:

• holders of common shares of Augusta ("Augusta Shares") (other than Hudbay and its subsidiaries and shareholders who properly exercise their right of dissent in respect of the amalgamation) will receive for their Augusta Shares the same consideration as was paid by Hudbay for Augusta Shares pursuant to Hudbay's offer (the "Offer"), and

• Augusta will become an indirect, wholly-owned subsidiary of Hudbay.

Augusta's board of directors (the "Board of Directors") previously determined, after consultation with its financial and legal advisors, that the consideration paid pursuant to the Offer (0.315 of a common share of Hudbay (a "Hudbay Share") and 0.17 of a warrant to purchase a Hudbay Share) is fair to shareholders of Augusta, that it is in the best interests of Augusta to support and facilitate the Offer and to recommend that shareholders of Augusta accept the Offer. The Board of Directors also has unanimously determined (with the Hudbay representatives on the Board of Directors having declared their interest and abstained from voting) that the Amalgamation is in the best interest of Augusta and recommends that shareholders of Augusta to vote FOR the Amalgamation.

The Amalgamation is conditional upon, among other things, approval by at least two-thirds of the votes cast by Augusta shareholders present in person or represented by proxy at the special meeting of Augusta shareholders (the "Meeting") to be held at 10:00 a.m. (Toronto time) on September 19, 2014, and "minority approval" in accordance with Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions. The votes associated with the Augusta Shares held by Hudbay and its subsidiaries, which Hudbay intends to vote in favour of the Amalgamation, will be sufficient to effect both such approvals.