- Steppe Gold Ltd. (TSX:STGO) has signed a definitive share exchange agreement to acquire all issued and outstanding common shares of Boroo Gold LLC
- This all-share transaction intends to solidify Steppe Gold’s position as the country’s leading gold producer, propelling it to the forefront of the industry
- Boroo Gold reported revenues of US$132 million, fuelled by the production of 67,315 ounces of gold in 2023
- Steppe Gold opened trading at $0.70 per share
Steppe Gold Ltd. (TSX:STGO) has signed a definitive share exchange agreement to acquire all issued and outstanding common shares of Boroo Gold LLC.
The company stated this marks a significant milestone in Mongolia’s mining sector. This all-share transaction intends to solidify Steppe Gold’s position as the country’s leading gold producer, propelling it to the forefront of the industry.
Under the terms of the agreement, Boroo Singapore, a subsidiary of Boroo Gold LLC, will hold approximately 55.9 per cent of the issued and outstanding common shares of Steppe Gold on a fully diluted basis. The strategic move is poised to unlock synergies and efficiencies that will drive sustainable growth and value creation for shareholders of both entities.
The acquisition comes on the heels of Boroo Gold’s impressive performance in 2023, where it reported revenues of US$132 million, after the production of 67,315 ounces of gold. Despite the challenges posed by the global economic landscape, Boroo Gold maintained an all-in sustaining cost (AISC) of $847 per ounce, showcasing its operational resilience and financial robustness.
Looking ahead, Boroo Gold anticipates maintaining similar production levels in 2024, albeit with higher sustaining costs. The forecasted production of more than 400,000 ounces of gold from 2024 to 2031, with an average annual production of approximately 60,000 ounces in 2024, 2025, and 2026, underscores the vast potential and scalability of the combined entity.
Commenting on the acquisition, Bataa Tumur-Ochir, Chairman and CEO of Steppe Gold, expressed confidence in the transformative impact of the transaction, stating, “This strategic acquisition marks a significant milestone in Steppe Gold’s journey, positioning us as the preeminent gold producer in Mongolia. The integration of Boroo Gold’s assets and expertise into our portfolio will enhance our operational capabilities and drive sustained value creation for our shareholders.”
The amalgamation of Steppe Gold and Boroo Gold is expected to generate immediate and robust cash flows, bolstered by the strong production profile and favorable market conditions. With gold prices remaining buoyant and demand showing resilience, the combined entity is well-positioned to capitalize on the evolving dynamics of the precious metals market.
The acquisition underscores Steppe Gold’s commitment to creating long-term value for its stakeholders while contributing to the economic development of Mongolia. As the country’s flagship gold producer, Steppe Gold is poised to play a pivotal role in driving sustainable growth and prosperity for the nation and its people.
With regulatory approvals and closing conditions pending, the transaction is expected to be completed in the coming months, subject to customary closing procedures and shareholder consent. Once finalized, Steppe Gold will embark on a new chapter of growth and expansion, fuelled by the synergies and opportunities afforded by the integration of Boroo Gold’s assets and operations.
Steppe Gold is a precious metals exploration and development company focused on advancing gold projects in Mongolia. With a diversified portfolio of assets and a strong track record of operational excellence, Steppe Gold aims to unlock the full potential of Mongolia’s vast mineral resources.
Steppe Gold (TSX:STGO) opened trading at $0.70 per share.
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