Lake Shore Gold announced July 16 that it has submitted a proposal to Temex Resources to acquire all of the common shares of its next door neighbour in the Timmins camp.
Under the terms of the proposal, Temex shareholders would receive, for each Temex share, 0.105 of a Lake Shore Gold share, having a value of $0.13 based on the closing price of Lake Shore Gold's shares on the TSX on July 15.
Temex holds a 60 per cent interest in a joint venture with Goldcorp on the Whitney property, next to Lake Shore Gold’s Bell Creek Mine and mill.
The Whitney property includes the past producing Hallnor, Broulan Reef and Bonetal mines. The property has resource estimates that include 0.97 million tonnes at a grade of 7.02 grams per tonne for 218,100 ounces of gold in the measured category, 2.3 million tonnes at a grade of 6.77 grams per tonne for 490,500 ounces of gold in the indicated category, and 1.0 million tonnes at a grade of 5.34 grams per tonne for 170,700 ounces of gold in the inferred category.
Temex also owns another highly prospective property in the Juby Gold Project in the Shining Tree area.
Lake Shore’s proposal follows the heels of an announcement by Oban Mining in late June that it had entered into an agreement to scoop up Temex, Eagle Hill, Ryan Gold and Corona Gold.
Oban has ten business days to match or submit a better offer than Lake Shore’s.
“Our proposed acquisition of Temex provides an attractive opportunity to increase our asset base in the Timmins Camp by combining Whitney's significant high-grade gold resource with our very efficient and effective processing capabilities at the Bell Creek Mill,” said Lake Shore president-CEO Tony Makuch in a statement.
“We have considerable capacity in our mill, and adding a resource of Whitney's quality and quantity, particularly given its close proximity to Bell Creek, makes a lot of sense as we work to grow our company. As an in-market acquisition, the proposed transaction would be very complementary to our ongoing efforts to sustain and extend our current operations in Timmins and aggressively advance our very exciting organic growth opportunities in the area."
