MAG Silver acquiring Gatling Exploration

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MAG Silver Corp. [MAG-TSX, NYSE American] signed a definitive arrangement agreement to acquire all of the issued and outstanding common shares of Gatling Exploration Inc. [GTA-TSXV; GATGF-OTCQB] in an all-share transaction. Each Gatling shareholder will be entitled to receive 0.01702627 of a common share of MAG Silver for each share of Gatling held.

The consideration values Gatling at approximately C$0.40 per share, representing a premium of approximately 47.4% to Gatling shareholders, based on the 5-day volume weighted average price of each company as of the close of trading on March 10, 2022. Upon completion of the transaction, it is expected that Gatling shareholders will hold approximately 0.79% of Mag Silver shares on an outstanding basis.

Gatling is a Canadian gold exploration company focused on advancing the Larder Gold Project, located in the prolific Abitibi greenstone belt in Northern Ontario. The Larder project hosts three high-grade gold deposits along the Cadillac-Larder Lake Break, 35 km east of Kirkland Lake. The project is 100% owned by Gatling and is comprised of patented and unpatented claims, leases and mining licenses of occupation within the McVittie and McGarry Townships. The 3,370-hectare project area lies 7 km west of the Kerr Addison Mine. All parts of the Larder property are readily accessible and MAG Silver expects to engage the existing exploration team going forward.

“Gatling’s Larder property gives us a substantial toe hold along this regionally productive gold-bearing structure where we believe more gold should be findable,” said George Paspalas, MAG Silver’s President and CEO. “We are very impressed with the geological abilities of the Gatling field team and look forward to applying some new takes on where mineralization occurs in Abitibi orogenic gold systems.”

The arrangement has been unanimously approved by the board of directors of both Mag Silver and Gatling. Directors and officers of Gatling along with Gatling’s largest shareholder, Sprott Asset Management LP, holding in the aggregate 15.19% of the outstanding Gatling shares, have each entered into customary voting and support agreements to, amongst other things, vote in favour of the arrangement at the special meeting of Gatling securityholders to be held to consider the transaction.

MAG Silver is focused on becoming a top-tier primary precious metals mining company by exploring and advancing high-grade, district scale, silver-gold dominant projects in the Americas. Its principal focus and asset is the Juanicipio Project (44%), being developed with Fresnillo Plc (56%), operator. The project is located in the Fresnillo Silver Trend in Mexico, the world’s premier silver mining camp, where the operator is currently developing an underground mine and constructing a 4,000 tonnes/day processing plant. Underground mine production of mineralized development material commenced in Q3 2020 and is being processed through adjacent Fresnillo-operated plants. An expanded exploration program is in place targeting multiple highly prospective targets at Juanicipio. MAG Silver is also executing a multi-phase exploration program at the Deer Trail 100% earn-in project in Utah.


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