AuRico Gold (TSX:AUQ) (NYSE: AUQ) shot up 21% on Wednesday on massive volumes, after announcing it has offloaded a mine and two exploration projects and sold half of a development in Mexico to a local company.
Minera Frisco – a firm spun out of Grupo Carso (BMV: GCARSO, OTC: GPOVY) in 2010 and listed in Mexico with a market cap of more than $10 billion – is paying Aurico $750 million in cash for its Ocampo mine and the adjacent exploration projects “Venus” and “Los Jarros” all located in Chihuahua and a 50% interest in the Orion advanced development project located in Nayarit.
By mid-afternoon the Toronto-based miner was trading up 18.9% at $7.44 on the Toronto big board, near its highest for the day. Around 6.6 million shares or double the usual volumes in the $2.1 billion company had changed hands by 3:10 pm EST on Wednesday. The counter is still showing losses for 2012 – it is down 7% year to date.
Aurico said it will use the net proceeds from the transaction to pay down some of its debt and use it for other projects, but would also “undertake a significant return of capital to shareholders”.
Image by Cosimo Roams
