Agnico Eagle to Buy TMAC Resources for $225 Million
January 05 2021 - 6:13AM
Dow Jones News
By Dave Sebastian
Agnico Eagle Mines Ltd. is buying TMAC Resources Inc. for 286.6
million Canadian dollars (US$225 million), after the Canadian
government last month blocked the Chinese state-owned Shandong Gold
Mining Co. from buying the company.
The purchase price, at C$2.20 a share, is about 26% higher than
the C$1.75 a share Shandong would have paid. Agnico Eagle will
retire TMAC's outstanding debt and deferred interest and fees after
the transaction is expected to close by Feb. 8, the companies said
Tuesday.
Shandong, one of the world's largest gold-mining companies,
would have gained access to TMAC's mine almost 120 miles north of
the Arctic Circle if it had acquired the company. But former
Canadian national security and military officials came out against
the deal. They argued that it would give China too much access to
the Arctic, a sensitive region where China has been investing
because of its growing importance as a shipping route and a source
of valuable minerals.
"Our company spent almost the entirety of 2020 under the
uncertainty of a strategic review process and the Canadian
government review of the sale to Shandong, with an impending debt
maturity, compounded by the anxiety of the global pandemic," said
Jason Neal, president and chief executive of TMAC.
Resource Capital Funds, Newmont Corp., Shandong and all
directors and officers of TMAC, collectively holding about 62.3% of
outstanding TMAC shares, have agreed not to solicit competing
transactions, Agnico Eagle and TMAC said.
TMAC will seek approval for the transaction at a hearing before
the Ontario Superior Court of Justice on Jan. 20, it said.
The December decision to block TMAC's acquisition by Shandong
was the second time Canadian Prime Minister Justin Trudeau has
vetoed a China-led deal since coming to power in late 2015, partly
backtracking on his Liberal administration's initial policy goal of
developing closer economic ties with China.
Write to Dave Sebastian at dave.sebastian@wsj.com
(END) Dow Jones Newswires
January 05, 2021 06:58 ET (11:58 GMT)
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