- Gran Colombia Gold (TSX:GCG) has agreed to combine with Gold X Mining (TSXV:GLDX) and proposed combining with Guyana Goldfields (TSX:GUY)
- If approved, Gran Colombia will acquire each share in Guyana Goldfields in exchange for 0.142 of a Gran Colombia share
- In tandem, Gran Colombia will acquire the outstanding 81 per cent of Gold X shares in a 1:2 share-for-share ratio
- Gran Colombia Gold (GCM) is down 13.09 per cent, with shares trading for C$5.51 and a $334.7 million market cap
- Gold X Mining (GLDX) is down 5.09 per cent, with shares trading for $2.61 and a $99.6 million market cap
- Guyana Goldfields (GUY) is up 14.29 per cent, with shares trading for C$0.80 and a $139.65 million market cap
Gran Colombia Gold (TSX:GCG) has agreed to combine with Gold X (TSXV:GLDX) and proposed combining with Guyana Goldfields (TSX:GUY).
Gran Colombia has submitted its share acquisition proposal to Guyana Goldfields. If the proposal is accepted, the company will then be able to acquire Gold X through a business combination.
If approved, Gran Colombia will acquire each share in Guyana Goldfields in exchange for 0.142 of a Gran Colombia share. The exchange is worth C$0.90 a share, roughly a 29 per cent premium on Guyana Goldfields’ current share price.
Furthermore, Gran Colombia will make approximately $21.02 million available to Guyana Goldfields through a loan agreement.
In tandem, Gran Colombia will exchange the outstanding 81 per cent of Gold X shares in a 1:2 share-for-share ratio, respectively.
The deal has yet to gain approval from the three companies’ shareholders, who will discuss it at upcoming shareholder meetings.
All three companies operate in Latin America. Through the deal, Gran Colombia and Gold X have proposed merging the Toroparu and Aurora mines.
Gran Colombia’s Executive Chairman, Serafino Iacono, said he was excited to present this opportunity to all the companies’ shareholders.
“It is extremely rare to come across a transaction that can unlock significant tangible synergies outside of simply consolidating head offices.
“Not only does this transaction unlock meaningful value for all shareholders, but it creates a new Latin American gold champion with Latin American operators and mine builders. We will use our unique skillset to continue to grow Gran Colombia and create substantial value for all shareholders,” he said.
Serafino went on to say that Gran Colombia will present its vision for the combination in the coming weeks.
Gran Colombia Gold (GCM) is down 13.09 per cent, with shares trading for $5.51 at 1:27pm EDT.
Gold X Mining (GLDX) is down 5.09 per cent, with shares trading for $2.61 at 1:25pm EDT.
Guyana Goldfields (GUY) is up 14.29 per cent, with shares trading for C$0.80 at 1:23pm EDT.