Centerra Gold to acquire Thompson Creek Metals in $1.1 billion deal
Staff Writer | July 8, 2016
Centerra Gold agreed to acquire all of the issued and outstanding common shares of Thompson Creek Metals Company. Total transaction value, including the assumption of capital lease obligations, is equal to $1.1 billion.Article continues below
In connection with the closing of the Arrangement, Centerra will redeem all of Thompson Creek's secured and unsecuredv notes at their call price plus accrued and unpaid interest, in accordance with the their terms.
All of the Thompson Creek issued and outstanding common shares will be exchanged on the basis of 0.0988 of a Centerra common share for each Thompson Creek common share.
Upon completion of the Arrangement, existing Centerra and Thompson Creek shareholders are expected to own approximately 92% and 8%, respectively, of the pro forma company.
The Exchange Ratio implies consideration of C$0.79 per Thompson Creek common share, based on the closing price of Centerra common shares on the Toronto Stock Exchange on July 4, 2016, representing a 32% premium to the closing price of Thompson Creek common shares on the TSX on July 4, 2016.
The proposed redemption of Thompson Creek's 9.75% secured notes due in 2017, the 7.375% unsecured notes due in 2018, and the 12.5% unsecured notes due in 2019 is expected to be financed with a combination of a new US$325 million senior secured revolver and term loan facility provided by Scotiabank, a C$170 million bought deal subscription receipt offering which has been announced today by way of a separate press release and cash on hand at Centerra and Thompson Creek.
It is anticipated that the Thompson Creek shareholder meeting and closing of the proposed transactions will take place in the fall of 2016. ■ What to read next
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