Mines Management, Inc. [MGT-TSX; MGN-NYSE MKT] and Hecla Mining Company [HL-NYSE] have signed a merger agreement for Hecla to acquire Mines Management. In the proposed merger, each outstanding common share of Mines Management will be exchanged for 0.2218 of a common share of Hecla. This represents a 41% premium to Mines Management, using both companies’ 10-day Volume Weighted Average Price on May 20, 2016. The transaction is expected to close in the third quarter, 2016. The transaction is subject to approval by Mines Management shareholders and other closing conditions.
Following closing of the merger, Hecla intends to advance the evaluation program of the Mines Management Montanore Project. Located in northwestern Montana, Montanore is considered one of the largest undeveloped silver and copper deposits in North America. The project is approximately 10 miles from Hecla’s Rock Creek project and 50 miles north of Hecla’s Lucky Friday Mine in Idaho.
“The Montanore Project has been significantly advanced by Mines Management and, with the issuance of the final Environmental Impact Statement and Records of Decision early this year, now is the time to pass it on to Hecla to further advance the project and put it into production,” said Glenn Dobbs, Mines Management’s CEO and Chairman.
“Hecla is the logical company to move Montanore forward, with its close proximity to Rock Creek, as well as its similar geology and scale,” said Phillips S. Baker, Jr., Hecla’s President and CEO. “We have considerable experience operating Greens Creek in a National Monument which will, combined with our financial strength and commitment to the community and environment, help Montanore reach its full potential.”