- AngloGold Ashanti has signed a definitive agreement to acquire Corvus (KOR) and consolidate the Beatty District of Nevada
- The transaction implies a total equity value for all Corvus common shares and outstanding options to acquire common shares of approximately C$570 million
- The combination of Corvus and AngloGold Ashanti’s Nevada assets further consolidates one of the largest new gold districts in Nevada
- Corvus is a North American gold exploration and development company
- Corvus (KOR) is up 1.13 per cent and is trading at C$4.02 at 1:20 pm ET
AngloGold Ashanti has agreed to acquire the remaining 80.5 per cent of common shares of Corvus (KOR) it doesn’t already own.
The total transaction cost to AngloGold Ashanti is estimated to be approximately US$370 million. The transaction implies a total equity value for all Corvus common shares and outstanding options to acquire common shares of approximately C$570 million.
The offer price represents a premium of approximately 26 per cent to the closing price of Corvus common shares on the TSX on 12 July 2021, the day prior to the announcement that AngloGold Ashanti submitted a non-binding proposal to Corvus, and a premium of approximately 59 per cent to the closing price of Corvus common shares on the TSX on 5 May 2021, the day prior to the announcement of the loan agreement and exclusivity.
The combination of Corvus and AngloGold Ashanti’s Nevada assets further consolidates one of the largest new gold districts in Nevada (the Beatty District) and provides the opportunity for AngloGold Ashanti to establish, in the medium and longer-term, a meaningful, low-cost production base in a premier mining jurisdiction.
Consolidation of the Beatty District has the potential for significant synergies due to economies of scale and integrated infrastructure, including processing facilities at an attractive capital intensity.
The combined Beatty District asset base allows for streamlined engagement with federal, state and local stakeholders to advance and achieve shared sustainability goals and other district benefits, such as opportunities to design projects incorporating renewable energy, as well as develop conservation and other local projects in conjunction with the Beatty community.
Alberto Calderon, AngloGold Ashanti’s Chief Executive Officer and Executive Director said: “We are pleased to reach an agreement with Corvus that we believe is value-enhancing for all stakeholders. This transaction delivers a compelling, district-wide consolidation in Nevada, which allows for the Beatty District to become a potential Tier 1 asset for AngloGold Ashanti.”
“Placing these assets under single ownership will allow for significantly reduced capital intensity to develop the district with a phased and modular approach, providing for a meaningful, low-cost production base in the medium and longer-term,” concluded Calderon.
Jeffrey Pontius, Corvus’ President and Chief Executive Officer, said: “The proposed all-cash offer provides a compelling opportunity for Corvus shareholders to realize the significant value and eliminates exposure to future capital requirements to fund construction of Corvus’ projects.”
AngloGold Ashanti has a long track record of developing and operating gold assets in the United States, including the Jerritt Canyon Gold mine in Nevada and the Cripple Creek & Victor mine in Colorado.
AngloGold Ashanti has a North American regional office in Denver, Colorado, from where it manages its U.S. business interests as well as its global generative exploration portfolio, including its exploration portfolio in the United States.
AngloGold Ashanti holds several exploration assets in the Beatty District where it has been conducting exploration activities for four years and has drilled 70,688 meters during that period.
Targets will be considered with strict reference to AngloGold Ashanti’s capital allocation framework. Further details on AngloGold Ashanti’s integrated development plan for the Beatty District will be communicated during 2022.
AngloGold Ashanti, with its head office in South Africa, is an independent, global gold mining company with a diverse, high-quality portfolio of operations, projects and exploration activities across nine countries on four continents.
Corvus is a North American gold exploration and development company focused on its near-term gold-silver mining projects at North Bullfrog, Lynnda Strip and Mother Lode in the Beatty District of Nevada.
Corvus (KOR) is up 1.13 per cent and is trading at C$4.02 at 1:20 pm ET.
