Gold producer Gold Fields has agreed to acquire all the issued and outstanding common shares of mineral exploration company Osisko Mining in an all-cash deal valued at about C$2.16bn ($1.57bn).
Under the terms of the definitive arrangement agreement, Osisko Mining shareholders will receive a price of C$4.9 ($3.57) per share.
The consideration for the transaction represents a premium of approximately 55% to the 20‐day volume weighted average trading price per share on the Toronto Stock Exchange (TSX) for the period ending 9 August 2024.
Osisko Mining chairman and CEO John Burzynski said: “This premium transaction represents a strong and near-term outcome for our shareholders and is reflective of the truly world-class nature of the Windfall Project.
“In the span of nine years, we’ve transformed Windfall into one of the largest and highest-grade gold development projects globally, and this Transaction is a testament to the extraordinary entrepreneurial effort of the Osisko Mining team.”
To be completed by way of a statutory plan of arrangement under the Business Corporations Act (Ontario), the proposed merger will give Gold Fields complete control of the Windfall gold project in Québec, Canada.
The gold project is currently jointly and equally owned and managed by Gold Fields and Osisko Mining.
According to Osisko Mining’s December 2022 feasibility study, the Windfall project will produce about 300,000 ounces of gold a year. This will enable the project to become one of the low-cost mines in Gold Fields’ portfolio.
The Canadian gold project has an estimated mine life of 10 years.
Prior to the joint venture (JV) transaction between both parties in May 2023, Osisko Mining invested more than C$800m ($582.4m) in the Windfall project.
After the transaction, Gold Fields and Osisko Mining have each contributed an additional C$158m ($115m), bringing the total investment to date to more than C$1bn ($720m).
The environmental permitting for the full-scale construction of the Windfall gold project is in progress, with the final approval anticipated in 2025.
Through the deal, Gold Fields aims to firmly deliver on its Pillar 3 strategy to grow the value and quality of its portfolio of assets. It is also expected to consolidate the company’s interest in a world-class, advanced-stage project.
Gold Fields CEO Mike Fraser said: “We are pleased to consolidate the remaining 50% interest of the advanced-stage Windfall Project and its highly prospective exploration camp.
“Over the past two years, beginning with our initial due diligence in 2022 and throughout our joint ownership of the Project, since May 2023 with Osisko, we have developed a strong understanding of Windfall and its potential, and view it as the next long-life cornerstone asset in our portfolio.”
Following the completion of the deal, Osisko Mining’s shares will be delisted from the TSX and the company will no longer be a reporting issuer under applicable Canadian securities laws.
Subject to customary conditions, including, court, regulatory and shareholders’ approvals, the proposed transaction is expected to be completed in Q4 2024.
In April this year, Gold Fields achieved the first gold from the Salares Norte project in the Atacama region of northern Chile.
The Salares Norte is a high-grade gold-silver, open-pit deposit located in the High Andes at an altitude of 12,750-15,400ft above sea level.
