) has wrapped up its takeover of mining company Urastar Gold
Corp. The Canadian miner acquired all the outstanding shares of
Urastar pursuant to a statutory plan of arrangement under the
Business Corporations Act (British Columbia). Following closure
of the deal, Urastar is now a fully-owned subsidiary of Agnico
Agnico-Eagle penned a definitive agreement with Urastar in
March 2013. Urastar is engaged in the exploration of former gold
producing regions in Sonora, Mexico, which is among the richest
gold producing belts globally. Under the deal terms, each Urastar
shareholder will receive C$0.25 in cash in exchange for each
Urastar share they held.
Holders of in-the-money share purchase warrants who have not
otherwise exercised their warrants will receive C$0.15 in cash
for each warrant they held. Out-of-the-money warrants and options
will be cancelled as part of the deal. The value of the deal (on
a basic shares outstanding basis and assuming exercise of
in-the-money warrants) is roughly C$10.7 million (around $10.5
The deal was cleared at a special meeting on May 14 by 99.76%
of Urastar shareholders, voting together as a single class. Final
approval for the acquisition was secured from the Supreme Court
of British Columbia on May 15.
Agnico-Eagle, which is among the prominent Canadian gold
miners along with
), announced tepid first-quarter 2013 results last month. Its
profit, as reported, slid roughly 70% year over year to $23.9
million or 14 cents a share. Revenues slipped roughly 11% year
over year to $423.2 million in the reported quarter.
The results were hurt by a decline in payable gold production
which dropped 7% year over year to 236,975 ounces, mainly due to
the suspension of the Creston Mascota heap leach facility. While
Agnico-Eagle achieved record quarterly throughput at its
Meadowbank mine in northern Canada, its Kittila mine in northern
Finland recorded an 8% decline in payable gold production in the
Agnico-Eagle backed its production guidance for 2013 and sees
payable gold production in the range of 970,000 ounces to
1,010,000 ounces with second half of the year contributing
significantly to the overall production.
Resumption of production at Kittila, higher production at
Creston Mascota, the ongoing ramp up of production at LaRonde
mine in Quebec, higher expected grades at Meadowbank, and the
start of production at the Goldex mine in Quebec are expected to
be the contributing factors.
Agnico-Eagle currently retains a short-term (1 to 3 months)
Zacks Rank #5 (Strong Sell).
BARRICK GOLD CP (ABX): Free Stock Analysis
AGNICO EAGLE (AEM): Free Stock Analysis
GOLDCORP INC (GG): Free Stock Analysis Report
KINROSS GOLD (KGC): Free Stock Analysis
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