Anaconda Mining Inc. [ANX-TSX; ANXGD-OTC] said Friday April 13 it has launched a formal offer to acquire all of the issues and outstanding shares of Maritime Resources Corp. [MAE-TSXV], together with associated rights issued under Maritime’s shareholders rights plan dated March 15, 2018.
Under the offer, Maritime shareholders would receive 0.390 of a common share of Anaconda for each Maritime share held.
The offer includes Maritime shares that may become issued and outstanding after the date hereof, but prior to the expiry time of the offer upon the exercise, conversion or exchange of any securities of Maritime that are exercisable for, convertible into or exchangeable for Maritime shares other than shareholder rights plan (SRP) rights.
The offer will be open for acceptance until 5:00 p.m. (Toronto time) on July 27, 2018, unless the offer is abridged, extended or withdrawn.
The offer consideration represents $0.16 per Maritime share and marks a premium of approximately 64%, based on the 20-day volume weighted average prices of Maritime and Anaconda shares immediately prior to the date of the announced offer.
Maritime shares rose 8.70% or $0.01 to 12.5 cents Friday. Anaconda eased 1.3% or $0.005 to 38 cents.
Anaconda is currently the only producing gold miner in Atlantic Canada. The company is producing roughly 15,500 ounces of gold annually at its Point Rousse Project on the Baie Verte Peninsula, Newfoundland.
Maritime holds a 100% stake in the Green Bay property in central Newfoundland. Green Bay hosts the past-producing Hammerdown gold mine and the Orion gold deposits.
According to a NI 43-101-compliant resources estimate released in 2013, the property contains in excess of 400,000 ounces of gold in the measured and indicated category and in excess of 600,000 ounces in the inferred category. The estimate was compiled by Tetra Tech of Ontario.
The Hammerdown gold deposit was successfully mined by Richmont Mines Inc. from 2000 to 2004, producing 143,000 ounces of gold. But the mine was closed due to low gold prices. Richmont was swallowed by Alamos Gold Inc. [AGI-TSX, NYSE] in November, 2017.
“Anaconda has a clear growth strategy in Atlantic Canada, which includes acquiring gold projects that could benefit from the experience of our management team and the substantial infrastructure we already have in the place,” said Anaconda President and CEO Dustin Angelo.
“By accepting the offer, Maritime shareholders have the opportunity to realize a significant premium and participate in the upside of not only the Green Bay Project [in central Newfoundland], but also Anaconda’s projects,” he said.
“As a larger gold producer and developer, and a leader in Atlantic Canada, the pro forma company will have a greater market presence, leading to higher liquidity, lower cost of capital, and expanded financing options. With this combination Maritime shareholders will finally be able to realize the value that has eluded them to date.”