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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.