Wyloo Canada Holdings currently holds 23% of the outstanding common shares of Noront
Wyloo Metals plans to finance the acquisition through its existing cash reserves.(Credit: aymane jdidi from Pixabay)
Wyloo Metals has announced its intention to make a takeover offer for Noront Resources in a deal that values the company at nearly $133m ($110.2m).
Currently, Wyloo Canada Holdings, a wholly-owned subsidiary of Wyloo Metals, holds 23% of the outstanding common shares of Noront.
Responding to the unsolicited takeover offer, Noront said that it will review the terms of the proposal.
Wyloo Metals stated: “The Offer immediately crystallizes full and certain value for Noront shareholders while removing their exposure to the uncertainty of several further years of infrastructure and mine development associated with the Ring of Fire assets.”
Wyloo Metals plans to finance the acquisition of the Canadian-based miner through its existing cash reserves.
The offer is subject to customary conditions, including receipt of all required regulatory and third party approvals.
Wyloo Metals also intends to make available a C$5m($4.1m) unsecured, extendable loan to Noront, in addition to the takeover proposal.
Noront stated: “The Corporation is considering alternatives to secure its immediate short-term funding requirements, including the loan terms proposed by Wyloo.”
Noront is mainly focused on the development of the high-grade Eagle’s Nest nickel, copper and palladium deposit, located in the Ring of Fire region in Northern Ontario.
Upon entering into commercial operations, the Eagle’s Nest Mine is expected to produce 3,000 tonnes of ore per day, mined through underground methods.
Eagle’s Nest is estimated to have a mine life of 11 years, with a potential for 9 additional years.
It is also involved in the development of chromite deposits including Blackbird, Black Thor, and Big Daddy, located in the James Bay Lowlands of Ontario.
Wyloo Metals is the metals and mining subsidiary of Australia’s private investment group Tattarang.
In January, the company signed an earn-in agreement with Orford Mining for the West Raglan project in Quebec, Canada.