Scorpio Mining, US Silver & Gold Announce Merger

- November 7th, 2014

Scorpio Mining Corp. (TSX:SPM) and US Silver & Gold Inc. (TSX:USA) announced that they have entered into a definitive agreement under which they will merge their respective businesses, creating a “leading junior silver producer in the Americas.”

Scorpio Mining Corp. (TSX:SPM) and US Silver & Gold Inc. (TSX:USA) announced that they have entered into a definitive agreement under which they will merge their respective businesses, creating a “leading junior silver producer in the Americas.”

The new company will operate under the name Scorpio Mining Corp. and will have two producing mines, a mine in development and an advanced-stage exploration project.

Other transaction highlights include:

  • Diversified production base: Sustainable annual production of approximately 4.5 – 5.0 million silver equivalent ounces from Scorpio Mining’s Cosalá District operations in Sinaloa, Mexico and U.S. Silver & Gold’s Galena Complexin Idaho, USA.
  • Improving cash cost profile: Cash costs expected to decline as current operations and brownfield development assets are optimized and G&A synergies are realized.
  • Proven management team: Extensive experience in all critical mining disciplines with demonstrated capabilities in financing, acquiring, developing and operating open pit and underground mines.
  • Solid financial position: Pro forma net working capital of approximately C$40 million (including approximately C$21 million in cash)1 with greater access to capital to fund future growth initiatives.
  • Robust reserve and resource base: Supports sustainable operations at current prices with further potential profitable expansion at higher prices from earlier stage internal projects.
  • Enhanced market presence: The larger company is expected to appeal to a broader institutional shareholder base, increase analytical following and improve share trading liquidity.
  • Compelling value proposition: Leading leverage among junior silver producer equities and attractive relative valuation on net asset value and cash flow multiples.

Click here to read the full Scorpio Mining Corp. (TSX:SPM) and US Silver & Gold Inc. (TSX:USA) press release.

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