Alamos Gold Inc. has announced a formal offer acquiring all outstanding common shares of junior gold miner Aurizon Mines Ltd. from its shareholders in a hostile takeover.
Alamos would acquire the Aurizon Shares for consideration value to the tune of $780 million. Each Aurizon shareholder can opt to receive consideration per Aurizon share of in cash or of a common share of Alamos. Each case contains a pro-ration based on a cash consideration and a maximum number of Alamos shares.
Alamos offers an “attractive alternative for Aurizon shareholders,” said President and CEO John McClusky in a statement. “We believe the companies will form one of the strongest and lowest-risk production and growth profiles in the gold sector today.”
Aurizon company officials say they are reviewing the offer with advisers. “We will make recommendations on this proposal we believe are in the best interest of Aurizon shareholders,” they said in a statement.
The merger would combine two single-asset gold miners creating a leading intermediary with 320,000 to 370,000 oz of annual production through 2015 and 500 gold oz by 2016.
Alamos is a Canadian-based gold producer that owns and operates the Mulatos mine in Mexico, with exploration and development activities in Mexico and Turkey. The company employs over 600 people in both countries. Aurizon operates the Casa Berardi mine in Quebec.