Integra Resources has entered into a definitive arrangement agreement to acquire all issued and outstanding shares of Florida Canyon Gold (FCGI) through a court-approved plan of arrangement.
This merger will establish a diversified, Great Basin-focused gold and silver producer with an immediate annual gold production capacity of approximately 70 thousand ounces (kozs) of gold equivalent (AuEq) from the Florida Canyon Gold Mine.
The combined entity will also benefit from a growth pipeline featuring high-quality development stage assets such as the DeLamar Project and the Nevada North Project.
According to the transaction terms, FCGI shareholders will receive 0.467 of a common share of Integra for each common share of FCGI.
Post-Transaction, existing shareholders of Integra and FCGI will own approximately 60% and 40%, respectively, of the outstanding Integra Shares, prior to the completion of the equity financing described below, on a fully diluted, in-the-money basis.
The Exchange Ratio implies consideration of C$0.69 per FCGI Share, based on the closing market price of Integra Shares on the TSX Venture Exchange (the “TSXV”) on July 26, 2024, for a total consideration of approximately C$95m.
The transaction will be executed through a court-approved plan of arrangement under the Canada Business Corporations Act. It requires the approval of (i) at least 66 ⅔% of the votes cast by FCGI shareholders in person or by proxy, (ii) if applicable, a simple majority of votes cast by FCGI shareholders, excluding votes of “related parties” and “interested parties” as mandated by Multilateral Instrument 61-101 Protection of Minority Security Holders in Special Transactions, and (iii) the approval of the Ontario Superior Court of Justice.
Directors and senior officers of FCGI have entered into voting support agreements, committing to vote their FCGI common shares in favour of the Transaction. Additional voting support agreements have been received from certain FCGI shareholders.
Upon the effective date of the Transaction, Integra’s Board of Directors will be reconstituted to include six current directors of Integra and two additional directors nominated by FCGI.
The Transaction is subject to several conditions, including shareholder and court approvals, applicable regulatory approvals (including TSXV approval), and customary closing conditions typical for such transactions.
Integra president and CEO Jason Kosec said: “The transaction between Integra and FCGI is a unique opportunity to combine production and cash flows with two complementary high-quality growth projects in the Great Basin, one of the best mining jurisdictions in the world.
“Post Transaction Integra will benefit from the currently cash flowing Florida Canyon mine, which provides investors immediate exposure to strong metal prices. DeLamar and Nevada North provide an unmatched growth pipeline that create a pathway to grow Integra from a junior to mid-tier producer in the coming years.
“As DeLamar is advanced through permitting and toward production, it will greatly benefit from the existing operational and technical capabilities of the team operating Florida Canyon. Moreover, the proximity of Florida Canyon to Nevada North will create a 20+ year mining complex that will benefit from tangible synergies and also deliver significant value to both shareholders and local communities.”
