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St Barbara to acquire Atlantic Gold in friendly offer for CAD 8022 million

Mining News - Published on Mon, 20 May 2019

Image Source: Denver Gold Group
Atlantic Gold Corporation announced that it has entered into a definitive arrangement agreement with St Barbara Ltd, signed on May 14, 2019, pursuant to which St Barbara will acquire 100% of all issued and outstanding shares of Atlantic by way of Plan of Arrangement. Under the terms of the Transaction, Atlantic shareholders will receive CAD 2.90 in cash per Atlantic share held plus shares in a company that holds Atlantic's interests in Velocity Minerals Ltd, which will be distributed to Atlantic shareholders on a pro-rata basis following completion of the Transaction. The CAD 2.90 per share cash consideration implies a total equity value for Atlantic of approximately CAD 7221 million and a total enterprise value of CAD 8022 million. SpinCo implies additional consideration of approximately CAD 12 million to Atlantic shareholders, or approximately CAD 0.05 per Atlantic share, for total cash plus SpinCo consideration of approximately CAD 2.95 per share. The CAD 2.95 per share offer represents a 41.1% premium to the closing price of Atlantic shares on the TSX Venture Exchange on May 14, 2019 and a 40.8% premium to the volume weighted average price of Atlantic shares over the last 30 trading days.

Following completion of the Transaction, SpinCo intends to raise funds via private placement and apply for a listing on the TSX-V. The cash offer is not subject to a financing condition. St Barbara intends to raise AUD 490 million through a concurrent underwritten accelerated non-renounceable entitlement to partly fund the Transaction. The balance will be funded via St Barbara's existing cash reserves. St Barbara has also secured a new committed AUD 200 million three-year corporate facility with Westpac Banking Corporation to support the combined company.

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Posted By : Rabi Wangkhem on Mon, 20 May 2019
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