Acquiring a gold producer in Mongolia Steppe Gold Ltd. / TSX: STGO
PR Title
Acquiring a gold producer in Mongolia
FRC Opinion
Positive – STGO is planning to acquire a gold producer, producing 60 Koz/year, for 149M shares/$98M, from a Singapore-based privately held investment company. Through this transaction, STGO should be able to increase its annual production from 30 Koz to 90 Koz immediately, with potential for further expansion to 160 Koz by 2026. We note that the acquisition is priced at $1,640/oz of annual production vs the sector average of $3,200/oz, reflecting a 49% discount. The company is on track to increase its production at the ATO gold mine from the current 30 Koz/year, to 100+ Koz by late 2025.