Aura Minerals to acquire Bluestone for US$74.3 million
Aura Minerals Inc. [ORA-TSX, ORAAF-OTCQX, AURA32-B3] bas struck a definitive deal to acquire all the issued and outstanding shares of Bluestone Resources Inc. [BSR-TSXV, BBSRF-OTCQB] by way of a plan of arrangement in a deal worth US$74.3 million.
Bluestone shares advanced on the news, rising 5.97% or $0.02 to 35.5 cents. The shares trade in a 52-week range of 85 cents and 17.5 cents. Aura rose 1.64% or 28 cents to $17.33.
Under the deal, Aura will be acquiring a 100% stake in Bluestone’s Cerro Blanco gold project and the adjacent Mita Geothermal project in Jutiapa, Guatemala. Cerro Blanco is a near surface high grade gold deposit. The Mita Geothermal project is an advanced-stage renewable energy project licensed to produce up to 50 megawatts of power.
The transaction values Bluestone at approximately 50 cents per share, representing a 51% premium to spot and a 40% premium to the volume weighted average price of the Bluestone shares on the TSX Venture Exchange for the 25 days ending October 24th, 2024, to be paid in a combination of cash and Aura shares on closing and a contingent value right (CVR), representing a total enterprise value of US$74.3 million.
For each Bluestone share held, Bluestone shareholders can elect to receive upfront consideration on closing consisting of either a cash payment of $0.287 or 0.0179 of an Aura share, subject to proration or a combination of both. The upfront consideration will be subject to a maximum aggregate Aura shares issuable of 1.36 million (representing 50% of the upfront consideration.)
Bluestone shareholders will also receive a CVR providing the holder with the potential to receive a cash payment of up to $0.2120 for each Bluestone share, payable in three equal annual installments up Cerro Blanco achieving commercial production.
The transaction has been unanimously approved by both Aura’s and Bluestone’s board of directors. It will also be subject to approval by Bluestone security holders at a special meeting.
Aura is a mid-tier gold and copper production company focused on operating and developing gold and base metal projects in the Americas. The company has four operating mines, including the Aranzazu copper-gold-silver mine in Mexico, the Apeona (EPP) and Almas gold mines in Brazil, and the Minosa (San Andres) gold mine in Honduras.
Aura was in the news last year when it announced additional financing for the fully funded for construction of the Borborema gold project in Rio Grande do Norte state, in northeastern Brazil.
Borborema is expected to produce 748,000 ounces of gold over an initial 11.3-year mine life from an open pit gold mine, according to a feasibility study, which sees the potential for additional production. With construction already under way, the company expects commercial production to start in the third quarter of 2025.