Extorre – XG – Enters Into Agreement For Sale To Yamana
Extorre Gold Mines Limited (NYSE:XG) is pleased to announce that it has entered into a definitive agreement with Yamana Gold Inc. pursuant to which Yamana will acquire all of the issued and outstanding common shares of Extorre by way of a statutory plan of arrangement under the Canada Business Corporations Act.
Transaction Details
Under the terms of the Agreement, each Extorre shareholder will receive in exchange for each Extorre Share held, $3.50 in cash and 0.0467 of a common share of Yamana . Each holder of an Extorre stock option shall be entitled to receive, upon the exercise of such Options, Yamana Shares based upon a share exchange ratio of 0.2648 of a Yamana Share for each Extorre Share which would have been issuable upon exercise of such Options prior to the effective date of the Arrangement.
Based on the closing price of the Yamana Shares on the Toronto Stock Exchange of $16.36 on June 15, 2012, the last trading day before announcement of the Arrangement, the implied transaction price of $4.26 per Extorre Share represents a premium of approximately 54% over the 20-day volume weighted average price of the Extorre Shares on the TSX for the period ending June 15, 2012. The transaction value on a basic shares outstanding basis is approximately $414 million. Completion of the Arrangement is subject to certain customary conditions, including receipt of all necessary court, shareholder and regulatory approvals. The Agreement also provides for, among other things, customary non-solicitation covenants, a “right to match” in favour of Yamana in the event of a superior proposal and the payment by Extorre to Yamana of a $15 million termination fee should the Arrangement Agreement be terminated in certain circumstances.
The special meeting for Extorre shareholders to approve the Arrangement is expected to occur on or about August 15, 2012. The Arrangement must be approved by 66⅔% of the Extorre Shares voted at the meeting.
The board of directors of XG, based on the recommendation of its special committee, unanimously determined the Arrangement to be in the best interests of the Company and recommends that the Extorre shareholders vote in favour of the Arrangement.
About Extorre – XG
Extorre (XG ) is a junior mining company with exploration and development stage precious metals projects in Argentina, the most advanced of which is its Cerro Moro project in the province of Santa Cruz. Extorre Shares are listed on the TSX and NYSE-MKT Exchanges under the symbol XG.
About Yamana
Yamana is a Canadian-based gold producer with significant gold production, gold development stage properties, exploration properties, and land positions in Brazil, Argentina, Chile, Mexico and Colombia. Yamana plans to continue to build on this base through existing operating mine expansions, throughput increases, development of new mines, the advancement of its exploration properties and by targeting other gold consolidation opportunities with a primary focus in the Americas.
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Post Written By: Ed Liston
Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing in his yacht.
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