i-80 Gold agrees to acquire Paycore Minerals

i-80 Gold Corp. [IAU-TSXV] has agreed to acquire Paycore Minerals Inc. [CORE-TSXV] in a definitive share exchange deal that aims to consolidate mining assets in the northern portion of Nevada’s Eureka District.

Transaction highlights include an exchange ratio of 0.68 of an i-80 Gold common share for each Paycore share held, representing a 36% premium for Paycore shareholders based on the 20-day volume weighted average price for both Paycore and i-80 for the period ended February 24, 2023. The deal also represents a 26% premium based on the closing prices of both companies on February 24, 2023 when i-80 closed at $3.18 and Paycore closed at $1.72.

Prior to the announcement, Paycore shares were trading in a 52-week range of $2.15 and 77 cents.

In a press release, i-80 said the deal has received unanimous board approval and support from Paycore’s largest shareholder, Waterton Nevada Splitter, LLC and Waterton Nevada Splitter 11, LLC, which holds approximately 25% of Paycore’s outstanding shares.

Paycore’s flagship asset is a 100% interest in the FAD project, which is located in the Ruby Hill Mining District, Eureka County, Nevada, a region with a history of high-grade carbon replacement deposit (CRD) production that began in the 1860s and spanned a period of more than 100 years.

The FAD deposit is located immediately south of and adjoins i-80’s 100% owned Ruby Hill property. As a result, the deal is expected to strengthen i-80’s dominant presence in the district by increasing the size of the land package at Ruby Hill by more than 34% to approximately 14,272 acres, providing i-80 with enhanced exposure to one of the world’s premier emerging CRD districts.

Upon completion of the transaction, i-80 will continue to own and operate its portfolio of mining assets, including Lone Tree, Ruby Hill, Granite Creek and McCoy Cove and will also own 100% of the FAD property.

The deal with Paycore is being announced after i-80 recently said it has completed initial gold sales from residual heap leach operations at its Lone Tree and Ruby Hill mines..

i-80 Gold has been in the process of developing multiple mining operations to achieve its objective of building a Nevada-focused mining company with a goal of ultimately producing more than 500,000 ounces of gold annually.

Importantly, the company has secured the ability to process all types of gold mineralization, including refractory gold-bearing mineralization, through the acquisition of the Lone Tree processing complex and also through interim processing arrangements with Nevada Gold Mines (a joint venture owned by Barrick Gold Corp. [ABX-TSX, GOLD-NYSE], Newmont Corp., [NGT-TSX, NEM-NYSE]), that provide the company with the flexibility to process material from any of the three planned underground operations until the Lone Tree autoclave is restarted.

Processing of refractory mineralization remains one of the biggest barriers to entry in Nevada and i-80 is currently one of only three companies with this capability.