Alamos Gold signs deal for Argonaut Gold and its Magino mine in Ontario
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Hey there, time traveller!
This article was published 27/03/2024 (652 days ago), so information in it may no longer be current.
TORONTO – Alamos Gold Inc. has signed a deal to acquire Argonaut Gold Inc.’s Magino mine in Canada, while the company’s assets in the United States and Mexico will be spun out to its existing shareholders.
Argonaut’s Magino mine is located next to Alamo’s Island Gold mine in Ontario. Alamos says integration of the two operations is expected to allow for the use of shared infrastructure and create significant savings.
Under the agreement, Argonaut shareholders will receive 0.0185 of an Alamos common share and one share in a new company for each Argonaut share they hold.
The exchange ratio implies an estimated value of 40 cents per Argonaut common share or a total of about $440 million based on the price of Alamos shares Tuesday and the estimated value of the shares in the new company.
The new company will own Argonaut’s Florida Canyon mine in the United States, as well as the El Castillo Complex, the La Colorada operation and the Cerro del Gallo project in Mexico.
In connection with the transaction, Alamos has agreed to provide Argonaut with a $50-million private placement equity financing that will give it a 14 per cent stake in the company. Once the new company goes public, Alamos has also has agreed to increase its stake to 19.9 per cent.
This report by The Canadian Press was first published March 27, 2024.
Companies in this story: (TSX:AGI, TSX:AR)