Teranga Gold Completes Acquisition of Massawa Gold Project
March 04 2020 - 3:55PM
Teranga Gold Corporation (“Teranga” or the “Company”) (TSX:TGZ;
OTCQX:TGCDF) today announced that it has completed the previously
announced acquisition of a 90% interest in the Massawa Gold Project
(“Massawa”) from a wholly-owned subsidiary of Barrick Gold
Corporation (“Barrick”) (TSX:ABX; NYSE:GOLD) and its joint venture
partner, Compagnie Sénégalaise de Transports Transatlantiques
Afrique de l’Ouest SA (“CSTTAO”), with the Government of Senegal
holding the remaining 10% interest in Massawa (the “Transaction”).
With the receipt of Massawa’s exploitation
license and residual exploration license, as well as formal consent
to integrate Massawa into Teranga’s existing Senegalese gold
operation, all of the closing conditions for the Transaction are
now satisfied.
“Now that the Transaction is complete, we are
turning our focus to integrating the high-grade Massawa deposits
into our mine plan and leveraging our existing infrastructure at
Sabodala. The combination of the two assets results in significant
capital and operating synergies and creates a top-tier gold
complex. The Massawa acquisition is transformational and, when
combined with our recently commissioned Wahgnion gold mine,
repositions Teranga as a low-cost mid-tier gold producer,” said
Richard Young, President and CEO.
Mr. Young continued, “Congratulations to the
Teranga and Barrick teams, as well as our lender, Taurus, and all
of our financial and legal advisors on this achievement. As well,
special thanks to the Government of Senegal for its support of our
continued growth in Senegal.”
Transaction Financing
Completed
The upfront consideration totaled $380 million and
consisted of approximately $300 million in cash and an aggregate of
approximately $80 million in Teranga common shares (“Teranga
Shares”) issued to Barrick and CSTTAO. In respect of the
share component of the upfront consideration, approximately 19.2
million Teranga Shares were issued to Barrick and approximately 1.6
million Teranga Shares were issued to CSTTAO.
Concurrent with the completion of the
Transaction, Teranga also closed the previously announced financing
transactions as follows:
- $225 million acquisition facility
agreement entered into with Teranga’s existing lender, Taurus Funds
Management Pty Ltd. (“Taurus”) and Barrick as lenders, $200 million
of which was lent by Taurus, with the remaining $25 million
provided by Barrick;
- $106 million (C$140 million) bought
deal offering of 27,451,000 subscription receipts of Teranga (since
exchanged for Teranga Shares); and
- $45 million private placement of
11,677,942 Teranga Shares with Tablo Corporation, in connection
with the exercise of its pro rata pre-emptive rights.
As announced on December 10, 2019, all Teranga
Shares issued as part of the Transaction and the concurrent
financings were issued at the bought deal price of C$5.10 per
Teranga Share. A portion of the proceeds of the financing
transactions were used to fund the cash portion of purchase price
of the Acquisition, with the balance of proceeds being used for
exploration drilling across Teranga’s portfolio,
Transaction-related costs and for working capital purposes.
Forward-Looking Statements
This press release contains certain statements
that constitute forward-looking information within the meaning of
applicable securities laws ("forward-looking statements"), which
reflects management's expectations regarding Teranga's future
growth and business prospects and opportunities. Forward-looking
statements include, without limitation, all disclosure regarding
possible events, conditions or results of operations, future
economic conditions expectations and anticipated courses of action.
Although the forward-looking statements contained in this press
release reflect management's current beliefs based upon information
currently available to management and based upon what management
believes to be reasonable assumptions, such forward-looking
statements are based upon assumptions, opinions and analysis that
management believes to be reasonable and relevant but that may
prove to be incorrect. Teranga cautions you not to place undue
reliance upon any such forward-looking statements.
The risks and uncertainties that may affect
forward-looking statements include, among others: the inherent
risks involved in exploration and development of mineral
properties, including government approvals and permitting, changes
in economic conditions, changes in the worldwide price of gold and
other key inputs, changes in mine plans and other factors, such as
project execution delays, many of which are beyond the control of
Teranga, as well as other risks and uncertainties which are more
fully described in Teranga's amended and restated Annual
Information Form dated July 31, 2019, and in other filings of
Teranga with securities and regulatory authorities which are
available on SEDAR at www.sedar.com. Teranga does not undertake any
obligation to update forward-looking statements should assumptions
related to these plans, estimates, projections, beliefs and
opinions change. Nothing in this document should be construed as
either an offer to sell or a solicitation to buy or sell Teranga
securities. All references to Teranga include its subsidiaries
unless the context requires otherwise.
About Teranga
Teranga is a multi-jurisdictional West African
gold company focused on production and development as well as the
exploration of approximately 5,500 km2 of land located on
prospective gold belts. Since its initial public offering in 2010,
Teranga has produced more than 2 million ounces of gold at its
Sabodala operation in Senegal. Focused on diversification and
growth towards its vision of becoming a mid-tier producer, the
Company recently announced commercial production at its second gold
mine, Wahgnion, which is located in Burkina Faso, and is carrying
out exploration programs in three West African countries: Burkina
Faso, Côte d’Ivoire and Senegal. Teranga applies a rigorous capital
allocation framework for its investment decisions.
Steadfast in its commitment to set the benchmark
for responsible mining, Teranga operates in accordance with
international standards and aims to act as a catalyst for
sustainable economic, environmental, and community development as
it strives to create value for all of its stakeholders. Teranga is
a participant of the United Nations Global Compact and a leading
member of the multi-stakeholder group responsible for the
submission of the first Senegalese Extractive Industries
Transparency Initiative revenue report.
Contact Information
Richard Young President & CEOT: +1 416-594-0000 | E:
ryoung@terangagold.com |
Trish Moran VP, Investor Relations & Corporate CommunicationsT:
+1 416-607-4507 | E: tmoran@terangagold.com |
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