canadian producer Argonaut Gold (TSX:AR) has been given the all clear from the Mexican anti-trust commission and an Ontario court for Alamos Gold (TSX:AGI) to acquire the C$523.7 million ($568.5 million) market capitalised explorer.
The clearance decision from the Comisión Federal de Competencia Económica in Mexico and the final order from the Ontario Superior Court of Justice were the final hurdles to completion of the takeover.
Alamos can now acquire all of the shares in Argonaut under the arrangement announced in late March this year.
Under the “friendly acquisition”, Alamos offered Argonaut shareholders 0.0185 of an Alamos common share and one share in a newly created junior gold producer for each Argonaut share held.
The new company, Florida Canyon, will own Argonaut’s projects in the United States and Mexico, including the Florida Canyon Mine in Nevada and the San Agustin Mine in Durango, Mexico.
Alamos estimates the deal values Argonaut at around C$0.40 per share, or US$325 million ($480.9 million).
At the time the offer was announced, it represented a 34% premium based on Argonaut’s and Alamos’ closing prices on 26 March 2024 on the Toronto Stock Exchange.
Argonaut’s shares were trading around C$0.30 and have since climbed to C$0.48.
Alamos will keep Argonaut’s flagship Magino mine in its portfolio because of the synergies it offers being located adjacent to its Island Gold Mine in Ontario, Canada.
The integration of the two operations is expected to create one of the largest and lowest cost gold mines in Canada.
Through the use of shared infrastructure, Alamos estimates it will realise immediate and long-term synergies worth US$515 million.
The addition of Magino is also expected to increase Alamos’ combined gold production to over 600,000 ounces per year, with longer term production potential of over 900,000 ounces per year.
Over 70% of Argonaut shareholders voted in favour of the takeover at a shareholder meeting in late June.
Write to Angela East at Mining.com.au
Images: Argonaut Gold
