Premier Gold Mines Ltd. has agreed to purchase Goldstone Resources Inc. in a share swap valued at about $87.9-million that will give it full ownership of the Hardrock project in northwestern Ontario.
Under the terms announced late Tuesday, Goldstone shareholders will receive 0.16 of a Premier share plus $0.0001 in cash for each Goldstone share.
Premier said it will issue about 16.7 million additional shares to complete the transaction. Once completed, the agreement will give Goldstone shareholders about 13.8 per cent of Premier shares on a fully diluted basis.
The board of directors at both companies have unanimously approved the transaction with directors representing about 13.5 per cent of Goldstone entering into support agreements.
The two companies have worked together as joint venture partners on the Hardrock project.