Canada's Lahontan Gold acquires fellow miner to control regional Nevada package
TSX-V-listed Lahontan Gold Corporation has inked a definitive agreement to acquire all of the issued and outstanding common shares of Emergent Metals Corporation by way of a court-approved plan of arrangement.
Emergent shareholders will receive one Lahontan common share for every 3.21 Emergent shares held at an implied consideration of $0.115 apiece. The implied consideration represents a premium of 47.8% to Emergent's 30-day volume-weighted average price.
Once the transaction closes, existing Lahontan and Emergent shareholders will own 95.3% and 4.7% of the enlarged company, respectively.
The transaction offers Lahontan shareholders full ownership of the highly prospective West Santa Fe gold and silver project with only modest cash expenditure, while also eliminating royalties of $1.73-million on West Santa Fe and the newly acquired York claims adjoining the Santa Fe mine, which were originally due to Emergent.
The two-million Lahontan shares that were previously issued to Emergent in connection with the York claims acquisition will be returned to the company's treasury, representing a value of $770 000.
With the addition of the New York Canyon project adjacent to Santa Fe, Lahontan will control a regional-scale claim package in Nevada’s prolific Walker Lane totalling more than 93 km2.
Lahontan will also gain a portfolio of properties and gold royalties in Québec, and a package of leased mining claims in Nevada that provide additional opportunities for monetisation.
"Importantly, the transaction advances our objective of building a larger and more valuable Nevada precious-metals company while maintaining our focus on disciplined capital allocation.
"Our priorities remain clear: advance the Santa Fe mine toward production and cash flow, expand our gold and silver resource base through exploration, position the company for future production growth, and selectively pursue additional opportunities in the Walker Lane that can add meaningful value to our shareholders," says Lahontan CEO and president Kimberly Ann.
