The deal gives the US miner access to the producing Eagle Gold Mine in Canada
Orion Co-VI sells 17.8% stake in Victoria Gold to Coeur Mining. (Credit: Gerd Altmann from Pixabay)
Coeur Mining has acquired a stake of around 17.8% in Canadian gold miner Victoria Gold from Orion Co-VI for about CAD146.1 million ($117.2m) in an all-stock deal.
The US-based precious metals mining company has offered a price of CAD13.2 ($10.92) per share to acquire the stake. In exchange, Orion Co-VI will be issued a stake of around 4.9% in Coeur Mining.
Orion Mine Finance, which is the controlling firm of Orion Co-VI, said that the sale of some of its shares in the Canadian miner is for investment purposes.
Victoria Gold is the owner of the Eagle Gold Mine located in Yukon, Canada. The conventional open pit gold mine entered into commercial production in July 2020.
At full production, the Eagle Gold Mine is estimated to yield 210,000 ounces of gold annually. The reserve of the asset is 3.3 million ounces of gold and the mine life is more than 11 years.
Coeur Mining president and CEO Mitchell Krebs said: “We have long admired the quality of Victoria’s Eagle asset and its recent success in ramping up operations.
“This compelling opportunity to acquire 17.8% ownership interest in Victoria from Orion is consistent with our stated strategy and capital allocation framework, and complements our existing portfolio of precious metals assets in high-quality jurisdictions in North America.
“We are excited to become a shareholder of Victoria, and believe this transaction represents an attractive investment for our stockholders.”
Concurrently, Orion Co-VI, which held a stake of 36.24% in Victoria Gold prior to the deal, has committed to vote in favour of an offer from Coeur Mining to acquire at least 50% shares and up to all of the Canadian company’s properties and assets.
Coeur Mining currently has five fully-owned operations. Of these, three are in the US, which include the Kensington gold mine in Alaska, the Rochester silver-gold mine in Nevada, and the Wharf gold mine in South Dakota.
The other two assets of the US firm are the Palmarejo gold-silver complex in Mexico and the Silvertip silver-zinc-lead mine in British Columbia, Canada.