--Analyst Actions: AuRico Gold at the Denver Gold Forum

AuRico Gold (AUQ.TO) presented at the Denver Gold Forum: On September 19, 2011, Rene Marion, CEO of AUQ presented at the Denver Gold Forum and elaborated on the company's rationale for the pending acquisition of Northgate Minerals. AUQ addressed a couple of concerns with the deal:

On due diligence: "AUQ indicated that it had not visited the YD site prior to the bid, but has subsequently visited the site (two weeks ago) and are satisfied that AUQ's desktop due diligence corresponds to the site visit. AUQ is hosting an investor tour to its Mexican operations Sept 21-24th, while NGX is hosting a Young Davidson tour on October 5th."

On running a large company - company within a company philosophy: "AUQ stated that it intends to retain the NGX mine management team to run the existing NGX operations and to continue to bring Young Davidson into production. Although the Australian operations are currently cash flow positive, Fosterville and Stawell are considered non-core and will be closely evaluated for rationalization."

Replacing high cost Aussie ounces possible: "AUQ indicated that even if the 200kozs from Australia were eliminated, it is confident these high cost ounces could be replaced from expansions at YD (to 300-350kozspa from 220kozspa peak currently), at Ocampo (+1ktpd expansion to the mill to facilitate third underground mine, from El Chanate Phase 3-5 expansions and from El Cubo productivity improvements."

AUQ operational update: "El Chanate, of the five phased expansion, Phase 1 is complete and Phase 2 is underway and AUQ will complete a reserve update in Q1/12 and then update the market on Phases 3-5. AUQ is targeting a 21ktpd stacking rate by mid 2012. At El Cubo, currently mining at 1.5ktpd and 1.8ktpd by Q2/12 is being targeted. Ocampo hit record operating cash flow with the mill providing 82% of the OCF. AUQ has identified 13 new underground veins and six new open pit targets near the Ocampo mine."

At a recent presentation to Credit Suisse, Rene Marion addressed concerns with the bid:

First, the premium: "AUQ indicated that at the time the deal was struck, the premium was 40%. Subsequently, the AUQ share price appreciated 22% relative to NGX's share price. The acquisition price based on reserves was in-line with industry average."

Second, the timing: "NGX's previous CEO had not been receptive to merger/acquisition talks with AUQ. AUQ indicated that the announced retirement of outgoing CEO Ken Stowe and subsequently the proposed merger of NGX with Primero prompted AUQ to move on its offer. AUQ had developed models of all North American based producers and developers of similar or smaller size and had been impressed with Young Davidson."

Valuation: "Our $14.00/sh target price target is based on a blended target P/NAV multiple of 1.3x applied to our DCF of $10.35/sh with net cash of $0.64/sh."

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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