Mining’s old guard needs strong medicine
A new report details subpar investor returns in the mining industry over the last decade, particularly big cap diversified companies which have not adapted to new realities.
Vancouver-based Silver Standard Resources (TSX:SSO) said Monday it has inked a friendly deal to buy Saskatoon-based Claude Resources (TSX:CRJ), which operates a gold mine in northeastern Saskatchewan.
The offer values Claude Resources at Cdn$377 million in total or the equivalent of about $1.65 per share — mostly Silver Standard’s shares.
The takeover will result in Saskatchewan losing its only homegrown gold miner.
Claude’s shareholders would own about 32% of the combined company, which will be the new owner of the Seabee gold mine, located about 125 kilometres northeast of La Ronge in northeastern Saskatchewan.
The companies — which have a total of three operating mines in Canada, the U.S. and Argentina — estimate the new firm would produce the equivalent of 390,000 ounces of gold.
The takeover will result in Saskatchewan losing its only homegrown gold miner, which last year produced a record-75,748 ounces of the yellow metal.
Read also: Wave of deals to shake global gold industry in 2016
