Canadian gold and silver company Benchmark Metals has signed a definitive arrangement agreement to acquire mineral exploration company Thesis Gold.
Benchmark Metals expects its proposed merger with Thesis Gold to create one of the largest precious metals development and exploration companies in the Toodoggone mining district of northern British Columbia.
Under the deal terms, the shareholders of Thesis Gold will receive 2.56 of a Benchmark Metals common share for each share held at a value of C$0.96 ($0.72) per share.
Benchmark Metals independent director and Benchmark special committee chair Keith Peck said: “The merger of these companies establishes a leading precious metals development and exploration project in British Columbia with a strong balance sheet, remarkable scale, significant growth potential, synergistic advantages, cost efficiencies, and, ultimately, the potential to deliver an exceptional new world-class mining venture in a geographically desirable location.”
Upon completion of the transaction, the existing shareholders of Benchmark Metals and Thesis Gold will own around 60% and 40% shares of the combined company, respectively.
Furthermore, the combined company will implement a 2.6:1 share consolidation of its common shares as well as operate under the name of Thesis Gold.
The combined business is expected to have a strengthened balance sheet including more than $28m of anticipated cash and cash equivalents, as well as strong capital market support.
Benchmark Metals owns the Lawyers gold-silver project, which is located adjacent to exploration targets at Thesis Gold’s Ranch project.
Thesis Gold president and CEO Ewan Webster said: “The combined company will be well capitalised to execute on a catalyst-rich exploration and development programme over the next 12–15 months, with over 50,000m of drilling between both projects, focusing on resource growth, exploration and discovery; and the culmination of this work will deliver an updated resource estimate encompassing ounces for both projects, including high-grade near-surface material at the Ranch project; and an updated Preliminary Economic Assessment will add high-grade underground ounces from Lawyers and the newly delineated Ranch resource.”
Subject to the various conditions, the transaction is planned for completion in Q3 2023.