Gammon Gold Inc., a Halifax, Nova Scotia-based mining and exploration company, said it will acquire Capital Gold Corp. in a cash-and-share transaction valued at $288 million to gain properties in Mexico.
Capital Gold shareholders would receive 0.5209 of a Gammon common share and 79 cents for each outstanding share, Gammon said in a statement today. The deal values New York-based Capital Gold at $4.57 a share based on Gammon’s closing price on Sept. 24, the company said. That represents a 20 percent premium on Capital shares based on their closing price that day.
Capital Gold’s board of directors rejected an offer made by Timmins Gold Corp. on Aug. 31. Timmins, based in Vancouver, offered C$4.50 ($4.40), or 2.27 Timmins shares, for each Capital Gold share, Timmins said in a statement.
Capital Gold operates the El Chanate gold mine and the Orion development in Mexico.
Gammon fell 18 cents, or 2.5 percent, to C$6.99 at 4:29 p.m. in Toronto Stock Exchange composite trading. The shares have declined 40 percent this year. Capital Gold slid 4 cents, or 0.8 percent, to C$4.91, and has gained 28 percent this year.
To contact the reporter on this story: Laura Marcinek in New York lmarcinek3@bloomberg.net
To contact the editor responsible for this story: Simon Casey at scasey4@bloomberg.net
http://jodnet.blogspot.com
Capital Gold shareholders would receive 0.5209 of a Gammon common share and 79 cents for each outstanding share, Gammon said in a statement today. The deal values New York-based Capital Gold at $4.57 a share based on Gammon’s closing price on Sept. 24, the company said. That represents a 20 percent premium on Capital shares based on their closing price that day.
Capital Gold’s board of directors rejected an offer made by Timmins Gold Corp. on Aug. 31. Timmins, based in Vancouver, offered C$4.50 ($4.40), or 2.27 Timmins shares, for each Capital Gold share, Timmins said in a statement.
Capital Gold operates the El Chanate gold mine and the Orion development in Mexico.
Gammon fell 18 cents, or 2.5 percent, to C$6.99 at 4:29 p.m. in Toronto Stock Exchange composite trading. The shares have declined 40 percent this year. Capital Gold slid 4 cents, or 0.8 percent, to C$4.91, and has gained 28 percent this year.
To contact the reporter on this story: Laura Marcinek in New York lmarcinek3@bloomberg.net
To contact the editor responsible for this story: Simon Casey at scasey4@bloomberg.net
http://jodnet.blogspot.com
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