The C$1 billion deal brings together six mines with strong cash flow into one portfolio, the opportunity to optimize assets, and a growth pipeline to create a leading West Africa-based gold producer generating over 1 million ounces a year.
Over 99.9% of Endeavour’s shareholders, or 91.9 million votes, are in favour of the merger, the firm said in a statement. Both of the company’s boards have unanimously approved the transaction.
“We are pleased to have the strong support of the shareholders of Endeavour as we take this important step to create a leading West African gold producer,” Endeavour’s CEO Sebastien de Montessus said in a statement.
“The combined company will have improved strategic positioning, an enhanced ability to manage risks, a stronger capital market profile and sustained ability to produce over 1 million ounces of gold while improving the combined group’s ability to generate shareholder returns. We look forward to working closely with the SEMAFO team to close the transaction and integrate our teams.”
Under the deal, each SEMAFO shareholder will receive 0.1422 Endeavour shares, representing a premium of 27.2% based on the 20-day volume-weighted average price of both companies for the period to March 20 this year. The implied equity value for SEMAFO of C$1 billion based on Endeavour’s closing price on March 20 this year.
Review of deal
Endeavour and SEMAFO will now look to obtain approval for the arrangement from the Superior Court of Quebec. The firm received notice from the Minister Innovation, Science and Industry requiring additional time to consider whether a review of the deal is necessary.
The mining company said it will work with the director of investments to address any concerns or questions and said it is not aware of any reason for the notice.
The Minister has until June 25 to decide to order a review. Assuming no review is ordered, the transaction is expected to close before the end of June 2020.
SEMAFO operates the Mana and Boungou mines in Burkina Faso. Endeavour’s four mines include the Agbaou and Ity projects in Côte d’Ivoire and the Houndé and Karma operations in Burkina Faso.
Contact Angela at email@example.com
Follow her on Twitter @AHarmantas