Abitibi Metals boosts resource by 62% at B26 polymetallic deposit in Quebec
Indicated resources increased to 11.3 million tonnes from 6.9 Mt.
Shareholders of both Fortuna Silver Mines (NYSE: FSM) (TSX: FVI) and fellow Canadian Roxgold (TSX: ROXG) have approved the business combination of the companies in an all-share deal valued at about C$1 billion ($884.32 million).
The deal, first announced on April 26, will see current Fortuna and former Roxgold shareholders owning about 63.6% and 36.4% of the outstanding Fortuna Shares, respectively.
Vancouver-based Fortuna, which has operations in Peru, Mexico and Argentina, has said the combined company would produce about 450,000 ounces of gold equivalent a year.
The companies said the transaction, expected to close on July 2, creates a global premier growth-oriented intermediate gold and silver producer.
The transaction, expected to close July 2, creates a global premier growth-oriented intermediate gold and silver producer
The gold sector has seen an influx of mergers and acquisitions over the past year, fuelled by strong metal prices and pressure to replace reserves that have been mined.
Bank of America analyst Michael Jalonen predicted in a note early this year another round of consolidation for the industry in 2021 among small to medium-size gold miners.
Jalonen and his team noted that gold reserves have been falling since 2012, while gold output has remained stable. They added that an effective method to replenish depleted reserves was mergers and acquisitions.
Yamana Gold (TSX: YRI) (NYSE, LON: AUY) expanded its footprint in the precious metals-rich Abitibi region of Quebec, Canada, by acquiring all shares in smaller rival Monarch Gold late last year.
Endeavour Mining (TSX: EDV), already West Africa’s top gold producer, followed suit and bought Teranga Gold, in an all-share deal worth C$2.44 billion ($1.86 billion), which created a top 10 gold producer.
Another Canadian miner, Equinox Gold (TSX, NYSE: EQX) acquired in December Premier Gold Mines, spinning out the Nevada assets in a new US-focused gold miner — i-80 Gold Corp. The new company began trading in Toronto in early April under the symbol IAU.
In January, Agnico Eagle Mines (NYSE:AEM) merged with TMAC Resources, adding 3.5 million ounces of reserves in the process. That more than replaces Agnico Eagle’s reserves mined last year.
Most recently, Scottie Resources (TSX-V: SCOT) and AUX Resources (TSX-V: AUX) announced a potential merger that would consolidate the two companies’ gold-silver holdings in the Stewart mining camp in British Columbia’s Golden Triangle.
Junior Stratabound Minerals (TSX-V: SB), which is advancing its Golden Culvert project in southeastern Yukon, is also in the process of acquiring California Gold Mining (CNSX: CGM) and its Fremont gold project in the US.
