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Oban Mining Corp. (TSX:OBM) and NioGold Mining Corp. (TSXV:NOX) announced that they’ve entered into a definitive arrangement agreement under which Oban will acquire all of NioGold’s issued and outstanding shares.

Oban Mining Corp. (TSX:OBM) and NioGold Mining Corp. (TSXV:NOX) announced that they’ve entered into a definitive arrangement agreement under which Oban will acquire all of NioGold’s issued and outstanding shares.
In addition, Oban announced a private placement of 8,333,333 subscription receipts priced at $1.20 each for total gross proceeds of $10 million.
As quoted in the press release:

Under the terms of the Arrangement Agreement, holders of NioGold Shares (“NioGold Shareholders“) will be entitled to receive 0.4167 common shares of Oban (“Oban Shares“) in exchange for each NioGold Share held, representing an implied offer price of $0.50 per NioGold Share and a premium of approximately 51.5% based on the closing price of Oban Shares on the Toronto Stock Exchange ($1.20) and NioGold Shares on the TSX Venture Exchange ($0.33) on January 8, 2016 (being the last trading day prior to the announcement of the Arrangement).
The Arrangement will require the approval of at least 66⅔ percent of the votes cast by NioGold Shareholders at a special meeting expected to take place in March 2016 (the “NioGold Meeting“). NioGold Shareholders representing approximately 38.8% of the issued and outstanding NioGold Shares have entered into voting and support agreements with Oban in support of the Arrangement. The board of directors of NioGold, on the recommendation of its independent special committee (the “NioGold Special Committee“), has unanimously approved the Arrangement and will recommend that NioGold Shareholders vote in favour of the Arrangement.
The Arrangement will also require the approval of at least 50 percent of the votes cast by holders of Oban Shares (“Oban Shareholders“) at a special meeting expected to take place in March 2016 (the “Oban Meeting“). Oban Shareholders representing approximately 35.5% of the issued and outstanding Oban Shares have entered into voting and support agreements with Oban in support of the Arrangement. The board of directors of Oban, on the recommendation of its independent special committee (the “Oban Special Committee“), has unanimously approved the Arrangement and will recommend that Oban Shareholders votein favour of the Arrangement.

John Burzynski, president and CEO of Oban Mining, commented:

We are very pleased to announce today’s business combination with NioGold. This transaction provides an excellent opportunity for NioGold and Oban shareholders to combine assets with strong access to capital, and our management groups experience and track record of building valued mining companies. With the successful conclusion of this deal, we will have two development stage projects in Quebec as well as the promising Garrcon and Jonpol deposits in Ontario. Today’s merger with NioGold brings us another step closer to our goal of becoming Canada’s next leading intermediate mining company.” He also commented that, “The Offering is expected to provide Oban with funds to continue to develop our key projects at Windfall Lake and Marban, even as market conditions remain challenging for gold exploration and development companies, and to further explore the projects recently acquired from Northern Gold Mining Inc.

Click here to read the full Oban Mining Corp. (TSX:OBM) and NioGold Mining Corp. (TSXV:NOX) press release.

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