Vancouver, Canada — MININGREVIEW.COM — 02 June 2009 – TSX-listed Redback Mining – which holds an extensive exploration portfolio plus operating mines in Ghana and Mauritania – is buying Moto Goldmines for approximately C$513 million (R3.7 billion).
In a joint announcement here, the two companies confirmed that they had entered into an arrangement agreement pursuant to which each outstanding common share of Moto would be exchanged for 0.45 of a common share of Red Back. Based on Friday’s closing price of Red Back’s common shares of C$10.45 per share, the transaction value was approximately C$513 million (R3.7 billion). This represents a premium to Moto shareholders of approximately 40%, based on the 20-day volume-weighted average of both companies’ common shares on the TSX.
The announcement added that the combination of Red Back and Moto created a formidable African mining house and set the stage for the development of the Moto gold project in the DRC into a major African gold producer. Red Back was an experienced African gold miner with a significant and expanding production profile at both its Chirano Mine in Ghana and at its Tasiast Mine in Mauritania. The combination with Red Back brought the financing, development and operating expertise necessary to drive the Moto gold project to production, it added.
Upon commissioning of the Moto gold mine, Red Back will achieve total gold production in excess of a million ounces per annum with cash operating costs well below the industry average. It will be one of the largest African-focused gold producers with a substantial expanding reserve base.
Commenting on the combination with Moto, Red Back president and CEO Richard Clark, said: “The addition of the Moto gold project confirms Red Back’s commitment to aggressive growth in Africa based upon exceptional projects.”