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Aurizon Gold has eight properties in Quebec, including the Casa Berardi gold mine, as well as several development and exploration projects. (iStockphoto)
Aurizon Gold has eight properties in Quebec, including the Casa Berardi gold mine, as well as several development and exploration projects. (iStockphoto)

MINING

Hecla Mining makes $796-million 'white knight' offer to buy Aurizon Mines Add to ...

Aurizon Mines Ltd., a company focused on the Abitibi region of Quebec, has agreed to a friendly $796-million stock-and-cash takeover offer from Hecla Mining Co., which topped a hostile bid by Alamos Gold Inc.

The offer is valued at $4.75 per share, 10 cents more than the bid by Alamos Gold which had offered a mix of stock and cash valued at $4.65 per share.

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Aurizon chairman George Brack said Hecla has offered a substantial amount of cash plus shares in a company that will be worth about $1.6-billion after the combination.

“We are pleased that our rigorous process to seek value-maximizing alternatives has resulted in an agreement with Hecla which resulted in additional value for Aurizon shareholders,” Mr. Brack said.

Aurizon shares were up 17 cents at $4.52 on the Toronto Stock Exchange on Monday.

The company has eight properties in Quebec, including the Casa Berardi gold mine, as well as several development and exploration projects.

Alamos, which has its head office in Toronto, has a mine and mineral rights in Mexico and an advanced development project in Turkey while Hecla has mines in Alaska and Idaho, where its headquarters is located, as well as land packages in several other U.S. states and in Durango, Mexico.

The deal with Hecla requires approval of two-thirds of the votes cast by affected Aurizon security holders and two-thirds of the votes cast by Aurizon shareholders at a special meeting.

Assuming the deal is approved and all court and regulatory approvals are received, the agreement is expected to close in the second quarter.

Aurizon’s board has given Hecla the right to match any competing bid that comes up and will pay Hecla a $27.2-million termination fee under some circumstances.

Aurizon said it has waived its shareholder rights plan, as previously announced, and had cancelled a March 7 special meeting of shareholders to vote on the plan.

Hecla has capped the amount of cash it will pay at $513.6-million and the maximum number of shares it would exchange at 57 million. That would work out to about $3.11 in cash and about one-third of a Hecla share per Aurizon share.

Alamos has offered $4.65 in cash or 0.2801 of an Alamos share for each Aurizon share with the cash portion capped at a maximum of $305-million and the stock portion limited to 23.5 million Alamos shares.

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