The $ 1.50 conversation Canada's Alamos Gold buys Richmont in a deal valued at C$905 mln
(Adds Island Gold mine details and updates share movement)
Sept 11 (Reuters) - Canada's Alamos Gold Inc will buy smaller rival Richmont Mines Inc in a deal valued at about C$905 million ($747 million) to create a top-10 gold producer in North America.
Richmont shareholders will receive 1.385 Alamos share for each share held, or C$14.20, representing a 22 percent premium to Richmont's last close.
Shares of Alamos slumped 12 percent to C$9.02 on the Toronto Stock Exchange in early trading, while Richmont surged 6.7 percent C$12.40.
The combined company, which will have majority of its production in Canada, is expected to produce 500,000 ounces of gold in 2017, the companies said in a statement.
The deal includes Richmont's flagship Island Gold Mine in Ontario, known for its high-grade yield and low cost. As a result, Alamos's production is expected to increase at an average of 25 percent annually.
Upon completion of the deal, which is expected by mid-November, Alamos will own 77 percent of the combined company and Richmont the rest.
I remember the video well....what I took away from it....Alamos bought Richmont's and Island Gold...at the time Harte was trading at about 60 cents...and our outstanding shares issued was much, much, lower than today...Richmont's reserves at the time compared to what SR believed Harte's eventual resources would come to, brought Sr to the conclusion that Alamos had paid the equivalent of about $ 1.50 per Harte share to buy Richmont...thereby creating something of a " market value "...yes we were far from proving any of this, and far from proving profitability, but I believed this was the basis of the $ 1.50 promotional talk....of course it hasn't quite worked out that way...should have brought in a crack mining team to build the mine and operate it profitably...that was 4 years ago and much has gone wrong....I still maintain that the fundamentals here are what we need to focus on...roughly $ 100 million in debt...roughly $ 100 million in mill and infrastructure and CDN $ 5-6 BILLION in gold just sitting under the surface begging to be taken out of the ground by somebody...this is based solely on the gold we kinda know about.. Sugar, middle, wolf.....TT8, Stoughton, and the rest of the possibilities on our Lake Dayo land package all should ADD to our story....it's maddening that we sit at $ 60 million market cap with several billion in gold waiting to be made into beautifull bars....oh well..thats this morning's comments..as we wait