Couer Mining acquires Paramount Gold and Silver

19 April 2015 (Last Updated April 19th, 2015 18:30)

US-based Coeur Mining has completed its acquisition of Paramount Gold and Silver for $146m after gaining stockholder approval from both companies.

US-based Coeur Mining has completed its acquisition of Paramount Gold and Silver for $146m after gaining stockholder approval from both companies.

The firms entered into a merger agreement in December last year when Coeur agreed to acquire all outstanding shares of Paramount Gold and Silver.

The deal involves issuing 32.7 million Coeur shares to Paramount stockholders, along with a $10m cash contribution to its subsidiary, Paramount Gold Nevada.

Coeur owns a 4.9% interest in the subsidiary unit.

"Paramount's Mexican assets strengthen the long-term viability of Palmarejo throughout the price cycle and enhance Coeur's growth profile."

While 98.2% of Coeur shareholders voted in favour of the transaction, 96.9% of Paramount's gave approval.

Within the second quarter of this year, Coeur intends to finish a mineral reserve and resource estimate for its Palmarejo mine in Chihuahua, Mexico. The newly acquired asset is a part of the property.

Paramount's San Miguel project, which includes the Don Ese deposit, spans more than 121,000ha of land and surrounds the Palmarejo complex.

Coeur president and CEO Mitchell Krebs said earlier: "By adding Paramount's San Miguel project and particularly the Don Ese deposit to the ongoing mining activities at our Guadalupe deposit, Palmarejo will be well-positioned to remain one of the world's top-producing silver and gold mines with significantly higher grades and lower costs.

"Paramount's Mexican assets strengthen the long-term viability of Palmarejo throughout the price cycle and enhance Coeur's growth profile. We expect the transaction to lower our overall unit costs, improve our free cashflow in the current metal price environment, and provide near-term growth while preserving our liquidity."

Going forward, Paramount will stop operating as an independent organisation and will work as Coeur's subsidiary.