Endeavour Mining has announced a merger agreement with Avion Gold Corporation, which will result in the creation of a 300,000 ounce per year gold producer.
Endeavour said it had offered the target 0.365 Endeavour shares for each Avion share, valuing it at $C389 million ($369.9 million).
Also part of the arrangement is a $US20 million short term loan Endeavour will provide to Avion, to restart upgrades at the Tabakoto processing facility in Mali, to allow for ramp-ups in production from the Agbaou gold mine, also in Mali.
The acquisition will create one of the largest West African mining companies, with three operating mines and a fourth currently under construction.
“The acquisition of Avion complements our strategy of becoming a leading diversified gold producer,” Endeavour chief executive Neil Woodyer said.
“Avion’s Tabakoto mine and Kofi property in western Mali and the advanced Hounde propetry in Burkina Faso fit very well into Endeavour’s production and development portfolios.”
Endeavour also announced today that chief operating officer Mark Connelly had decided to step down to pursue other intersests.
He will be replaced by senior vice president of operations Adriaan Roux.
At 1:20PM, WST, Endeavour stocks were down 4.8 per cent, trading at $2.18.
