Alexandria Minerals Corp. (AZX-TSXV, ALDXF-OTC) has received a takeover offer from Agnico Eagle Mines Ltd. (AEM-TSX, AEM-NYSE) that it said is superior to a previous offer from Chantrell Ventures Corp. [CV.H-NEX] and Osisko Mining Inc. [OSK-TSX].
Alexandria shares rallied sharply on the news, rising 42.86% or $0.015 to $0.05 in heavy trading of over 25 million. The shares had previously traded in a 52-week range of $0.02 and $0.06.
In a June 13, 2019, Alexandria said Agnico-Eagle would purchase all of its issued and outstanding shares at a price of $0.05 per share or about $26 million.
Following the acquisition, Agnico-Eagle will consolidate an additional 14,819 hectares of mining claims that cover approximately 35 kilometres of the Cadillac-Larder Lake break in the Val d’Or, Quebec gold camp.
“We believe that the key Alexandria properties are highly prospective and underexplored and could potentially provide future sources of ore at our nearby Goldex mine,” said Agnico Exploration senior vice-president Alain Blackburn. “Agnico-Eagle has a long history of involvement with Alexandria, both as an equity investor and through the purchase of the Akasaba West property in 2014,” he said.
The purchase price would be payable at the election of each Alexandria shareholder in cash or shares as follows:
- $0.05 in cash.
- 000819355 Agnico shares plus $0.000001.
- 000819355 Angico shares.
In addition, all unexercised options of Alexandria would be exchanged for options to purchase Agnico shares and all unexercised warrants of Alexandria would remain outstanding and be exercisable for Agnico shares, in each case based on the exchange ratio between Alexandria shares and Agnico shares represented by the share alternative.
Based on advice from its financial advisors, the Alexandria board of directors has determined that the Agnico offer constitutes a superior proposal to the one made by Chantrell and Osisko.
The Alexandria-Chantrell Arrangement was subject to Osisko Mining completing a reverse takeover of Chantrell that would have resulted in Chantrell changing its name to 03 Mining Inc.
Under the Alexandria-Chantrell agreement, the Alexandria shareholders were entitled to receive 0.010309 common shares of the resulting issuer in exchange for each Alexandria share held immediately prior to the effective time of the Alexandria-Chantrell Arrangement.
Alexandria is a Canadian exploration and development company with strategic properties located in mining districts located in Val d’Or, Que., Red Lake, Ontario, and Snow Lake-Flin Flon, Manitoba.
Its key focus is a flagship property package along the fabled Cadillac Break in the Val d’Or area, including the Orenada gold project. On June 6, 2018, the Alexandria announced a new resource estimate for the Orenada project (for more details see below).
It said Orenada Zones 4 is estimated to contain an indicated resource of 194,500 ounces at 1.61 g/t gold, plus and inferred resource of 73,710 ounces at 1.92 g/t gold
Orenada Zones 2 and 4 contain a total inferred resource of 126,259 ounces at 1.89 g/t.
The updated resource was modelled using detailed geological wire frames of mineralized structures and consisted of both an open pit and underground mining scenario.
The company went on to add that the potential exists to extend the resource towards the western extension of the Orenada resource.
On Friday, Alexandria said it has notified Chantrell and Osisko that the Agnico offer constitutes a superior proposal, which it has decided to accept.
Chantrell now has until midnight on June 27, 2019 to raise its offer to a level that would be deemed superior to what Agnico is offering.