The Denver-based Apollo Gold Corporation (TSX: APG), whose Black Fox Mine sits 75 kilometres east of Timmins, has signed a letter of intent to merge with the Halifax-based Linear Gold Corp. (TSX: LRR).
The Denver-based Apollo Gold Corporation (TSX: APG), whose Black Fox Mine sits 75 kilometres east of Timmins, has signed a letter of intent to merge with the Halifax-based Linear Gold Corp. (TSX: LRR).
Unanimously approved by both boards of directors, the deal will have Apollo acquire all outstanding common shares of Linear, whose flagship Goldfields project is a development-stage gold project near Uranium City, Saskatchewan. Linear shareholders will receive 5.474 common shares of Apollo in exchange for each share of Linear.
Following the completion of the deal, Apollo will be owned 52.2 per cent by existing Apollo shareholders and 47.8 per cent by existing Linear shareholders. The completion of the merger will also find Apollo re-branding itself with a new name, which is still unannounced.
The deal values Linear at $102 million based on current outstanding shares, and will be completed in the second quarter of 2010.
Apollo Gold is expected to produce 100,000 ounces of gold in 2010 from its Black Fox Mine. Linear's Goldfields project is expected to produce 70,000 ounces of gold per year by 2013.
.jpeg;w=120;h=80;mode=crop)
