DJ Glamis Gold To Acquire Western Silver For C$1.2B >GLG
RENO, Nev. (Dow Jones)--Glamis Gold Ltd. (GLG) has agreed to acquire all outstanding shares of Western Silver Corp. (WTZ) for a total consideration of about C$1.2 billion (US$1 billion).
In a press release, Glamis said it's offering, for each Western Silver share, 0.688 of a Glamis share plus one share in a new exploration and development company. It said Western Silver will transfer to the exploration company about C$38 million in cash, its interest in the Carmacks Copper Project in the Yukon and an early-stage exploration project in Mexico.
Based on the 20-day weighted-average trading price for both companies' shares on the Toronto Stock Exchange, the transaction values each Western Silver share at C$23.96 plus the value of each exploration share, estimated to be 89 Canadian cents. On this basis, the consideration offered represents a premium of about 40%, Glamis said.
The transaction is subject to completion of a definitive arrangement agreement, approval by Western Silver shareholders and the receipt of regulatory approvals. The transaction isn't subject to due diligence, and is expected to close in May.
The boards of both companies have approved the transaction. The Western Silver board has received an opinion from Macquarie North America Ltd. that the transaction is fair, from a financial point of view, to Western Silver shareholders. Officers and directors of Western Silver have agreed to vote in favor of the transaction.
If the transaction isn't completed, Glamis said Western Silver has agreed to pay Glamis a break-up fee equal to 3.5% of Western Silver's market capitalization, under certain circumstances.
"This transaction will allow us to immediately exceed our three-year objective to grow proven and probable gold reserves to over 10 million ounces," Glamis said.
Orion Securities Inc. acted as exclusive financial adviser to Glamis. Macquarie North America Ltd. acted as financial adviser to Western Silver.
Glamis and Western Silver are mining companies.
Company Web Sites: glamis.com, westernsilvercorp.com |
