TORONTO — Gold miners Agnico Eagle Mines Ltd. and Kirkland Lake Gold Ltd. have agreed to merge.
Under the deal announced Tuesday , Kirkland Lake Gold shareholders will receive 0.7935 of an Agnico Eagle common share for each Kirkland Lake Gold common share held.
The new Agnico Eagle will be led by a combined board and management team including seven directors from Agnico Eagle and six from Kirkland Lake Gold.
Agnico Eagle CEO Sean Boyd will become executive chair of the board, while Kirkland Lake Gold CEO Tony Makuch will be chief executive of the combined company.
"The transaction creates a company with a strong platform of people, assets and financial resources to continue to build and operate a long term sustainable and self funding business," Boyd said in a statement.
"Kirkland Lake is an excellent cultural fit with Agnico Eagle, and we look forward to working together to further grow our business through exploration, mine development and optimization of our high-quality asset base."
Makuch said the deal creates an industry leader.
"The transaction represents a true merger of equals, with the business of both companies to benefit from the significant financial strength of the merged company, the extensive pipeline of development and exploration projects to drive future growth, and the potential to realize significant operational and strategic synergies along the Abitibi-Kirkland Lake corridor," Makuch said in a statement.
Existing Agnico Eagle shareholders will own 54 per cent of the combined company while Kirkland Lake Gold shareholders will hold 46 per cent.
The deal requires approval by a two-third majority vote by Kirkland Lake Gold shareholders and a simple majority vote by Agnico Eagle shareholders.
Agnico Eagle has mines are in Canada, Finland and Mexico as well as exploration and development activities in those countries and the United States and Colombia.
Kirkland Lake Gold has the Macassa mine and Detour Lake mine, both in northern Ontario, and the Fosterville mine in Australia.