A major deal in the mining industry with substantial ripples locally.
Alamos Gold and Argonaut Gold have announced a definitive agreement for Alamos to acquire all of Argonaut's issued and outstanding shares, which will see Alamos acquire Argonaut's Magino Mine near Dubreuilville, adjacent to Alamos' Island Gold Mine (which Alamos acquired when it bought Richmont in 2017).
Integration of the two operations is expected to create one of the largest and lowest cost gold mines in Canada, a move Alamos expects "to unlock significant value with immediate and long-term synergies expected to total approximately $515-million US", increasing Alamos' combined gold production to over 600,000 ounces per year, with longer-term production potential over 900,000 ounces a year.
Island Gold's been in production since October 2007 - producing over 1-million ounces of gold since - while Magino only began producing gold last June and achieved commercial production at the start of November.
Toronto-based Alamos won't be acquiring Argonaut's operations in the US and Mexico, however, instead spinning those out to Argonaut's existing shareholders as a new junior gold producer dubbed "SpinCo".
The deal still requires court, regulatory, and shareholder approvals, though both boards have given their approval and Argonaut's is recommending shareholders vote in favour.