SSR Mining and Alacer Gold have entered into an agreement to combine in an at-market merger of equals pursuant to a plan of arrangement under the Business Corporations Act (Yukon). The combined entity will continue as SSR Mining and will be headquartered in Denver, Colorado, with a corporate office in Vancouver, British Columbia, and will be led by Rod Antal as president and CEO and Michael Anglin as chairman.
SSR Mining is a Canadian-based precious metals producer with three operations, including the Marigold gold mine in Nevada, U.S., the Seabee Gold Operation in Saskatchewan, Canada, and Puna Operations in Jujuy, Argentina. Alacer’s cornerstone Çöpler gold mine is located in east-central Turkey about 1,100 kilometers (km) southeast from Istanbul and 550 km east from Ankara.
Alacer shareholders will receive 0.3246 SSR Mining shares for each Alacer share held. The exchange ratio implies C$8.19 per Alacer common share and a combined market capitalization of $4 billion. At closing, SSR Mining and Alacer shareholders will collectively own approximately 57% and 43% of SSR Mining, respectively.
The transaction will require the approval of at least 66-2/3% of the votes cast by the shareholders of Alacer at a special meeting. The issuance of shares by SSR Mining under the agreement is also subject to the approval of the majority of votes cast by the SSR Mining shareholders at a special meeting.
Completion of the transaction is also subject to regulatory and court approvals and other customary closing conditions.
Forecast 2020 production from the individual mines is as follows: at Çöpler, 230,000 ounces (oz) to 260,000 oz of gold from the sulphide plant and 80,000 oz to 100,000 oz from the oxide plant; at Marigold, 225,000 oz to 240,000 oz of gold; at Seabee, 110,000 oz to 120,000 oz of gold; and at Puna, 6 million oz to 7 million oz of silver, 21 million lb to 24 million lb of lead, and 7 million lb to 9 million lb of zinc.
The forward-looking three-year average annual production profile of the merged company is about 780,000 gold equivalent oz per year (oz/y) at all-in sustaining costs of about $900/oz.
Antal said, “The combination of Alacer and SSR Mining will create a diversified portfolio of high-quality, long-life mines across four mining-friendly jurisdictions. Our focus at Alacer over the past several years has been on generating peer-leading free cash flow — this merger allows us to continue this strategy while diversifying our single operating asset exposure.
“In addition, the increased financial strength of the combined business will allow us to leverage the proven project execution capabilities of the combined management team to continue delivering on the extensive organic growth portfolio and compete for attractive assets as they arise.
“The complementary nature of the assets and the cultural alignment of the organizations will facilitate an effective integration and allow us to continue to deliver value to our shareholders.”