The share exchange transaction would see MegumaGold acquire all the shares in Canadian GoldCamps and would consolidate the latter's properties in the Bathurst camp in New Brunswick and in Newfoundland, along with MegumaGold’s extensive ground in Nova Scotia. The enlarged company will aim to define more ounces and will also benefit from a strengthened balance sheet and board.
READ: MegumaGold closes acquisition of Osprey Gold to form leading precious metals explorer in Nova Scotia
"With this merger Meguma shareholders will benefit by not only be acquiring high-quality assets with growth potential, but also direct access to invaluable guidance from well-regarded board members," said Theo Van der Linde, MegumaGold's president, in a statement.
Under the deal, each Canadian GoldCamps shareholder will receive shares of MegumaGold equal to Canadian GoldCamps at an exchange ratio which equals one and one-tenth (1.1) Meguma shares per GoldCamps share.
Canadian GoldCamps will have the right to appoint three directors to the board of the resulting firm. The total number of members of such board of directors to be initially set at four. MegumaGold shall contribute management personnel to the resulting issuer.
The merger is subject to a number of conditions, including due diligence, approval by both boards and any necessary shareholder approvals.
Canadian GoldCamps has around 4,150 hectares of prospective gold properties in New Brunswick and in Newfoundland’s Central Newfoundland gold belt, where there has been significant recent exploration success.
The firm has seven claims near to the northeast-trending Dog Bay Suture and the parallel Appleton and JPB Faults, which have been identified as hosting significant gold-bearing potential.
Meanwhile, MegumaGold’s current focus is preparing drilling campaigns for its Caribou, Killag, and Touquoy West properties in Nova Scotia, where it holds over 119,000 hectares.
At Touquoy West, which is just four kilometres (km) to the west of St Barbara’s Touquoy mine, survey results have identified three main anomalies on strike with the Touquoy mine that have never been drill tested.
In September this year, MegumaGold completed an amalgamation with Osprey Gold, where it acquired the Goldenville deposit and four other gold projects within the Meguma Supergroup.
Shares added nearly 4% to stand at C$0.14 each in Toronto.
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