Canadian gold producer GCM Mining has signed a merger deal with Aris Gold, whereby GCM will acquire all the shares it does not already own in the latter.
The transaction will create a large-scale gold mining company in the Americas that is said to be ‘top-of-the-class’ among junior producers.
The agreed terms will see GCM acquire all the remaining outstanding shares of Aris Gold, at an exchange ratio of 0.5 of a GCM share for each Aris Gold share.
Headquartered in Vancouver, Canada, the combined entity will be Colombia’s biggest gold company and operate under the Aris Gold name.
Helmed by Ian Telfer as chairperson and Neil Woodyer as CEO and director, the consolidated business will have a balanced mix of production, development and exploration assets across the Americas.
Its portfolio will include Soto Norte, Segovia, and Marmato Mine operations in Colombia; the Juby project in Ontario, Canada; and the Toroparu project in Guyana.
Aris Gold chair Ian Telfer said: “The combined group creates a top-in-class company with multiple tier one assets. After Aris Gold became the operator of the Soto Norte joint venture, joining forces with GCM became a logical next step.
“Our increased scale will also broaden our future opportunities to continue building a +1 million ounce (oz) producer over the next few years.”
This deal is scheduled to close following the completion of the companies’ shareholder meetings, scheduled in mid-September this year.
The merged group is expected to have proven and probable mineral reserves of 3.8Moz of gold, as well as measured and indicated mineral resources of 18.3Moz of gold.
Furthermore, it is anticipated to have $397m of cash and $260m of additional committed funding.
GCM executive chair Serafino Iacono said: “Each team has unique strengths with GCM being the Colombian leader for responsible, sustainable mining practices.
“Together with Aris Gold’s Board and management, the combined group brings a track record of building sizable and successful mining companies; this transaction further diversifies the company’s portfolio and reaffirms Colombia as an area of focus.
“While I am stepping down from a day-to-day executive role, I will remain a director and adviser on matters in Colombia, as well as an enthusiastic security holder.”