The offer consists of $175m in cash and the assumption of all Centerra's obligations under the partnership agreement
Canada-based Premier Gold Mines has announced a $205m offer to acquire the remaining 50% stake in the Greenstone Gold Mines Partnership (GGM) which is held by Centerra Gold.
The offer consists of $175m in cash and the assumption of all Centerra’s obligations under the partnership agreement, including the remaining earn-in obligation of nearly $30m.
GGM’s main asset is the Hardrock mine project in Ontario, Canada.
Located on the Trans-Canada Highway near Geraldton, Hardrock is a large-scale, near permitted, mine development project.
Premier has submitted the offer in cooperation with third party firm
Premier has submitted the offer in collaboration with the support of a third party company (assignee) which has the financial capacity to both acquire Centerra’s interest and advance Hardrock through construction.
According to Premier, the assignee plans to function with Premier to help in obtaining the financial resources needed for the company to fund its 50% share of related mine construction costs.
Premier president and CEO Ewan Downie said: “This offer should be viewed favourably by Centerra as we believe that it represents a substantial premium to the median of current analyst consensus valuations attributed to Centerra’s 50% interest in GGM, full recovery of their total investment in GGM to date, and aligns with Centerra’s stated focus of maximising the value of its existing operating assets over new build opportunities.
“The value of the offer is in excess of Premier’s market capitalization, especially when you consider the Company’s considerable cash position.”
Premier stated Hardrock is the product of over 12 years of exploration, development and engineering work that resulted in the delivery of an initial feasibility study in late 2016.
In November 2018, Premier Gold Mines had entered into an agreement with Ely Gold Royalties to acquire a 100% interest in the Rodeo Creek Property located in the Carlin Trend of Nevada.
Premier Gold Mines is a gold producer and exploration firm with operations and properties in Canada, the US, and Mexico.