Cambior bids for Audrey shares

Montreal-based Cambior (TSE) will acquire the remaining issued and outstanding common shares of Audrey Resources (TSE) by Sept. 1.

Cambior will offer $1.40 per Audrey share, in the form of cash or the equivalent in Cambior shares. Cambior currently holds 34.1 million Audrey shares, representing 75.03% of those that are outstanding.

The offer is contingent upon several factors, including Cambior’s receiving at least 90% of those shares not currently held.

If successful, the company intends to integrate Audrey’s operations with those of Cambior. The senior gold producer noted that completion of the transaction will enable Audrey’s minority shareholders to divest their holdings in what it refers to as “a relatively illiquid, sparsely traded stock, at a premium to the current market price.” At the time of the offer, Audrey shares were trading at $1.20 (the 52-week range being between $1 and $1.52).

Audrey’s principal asset is the Bouchard-Hebert zinc-copper-gold and silver mine near Rouyn-Noranda, Que. The mine started up in January and, for the year, is expected to produce 25,800 tonnes zinc, 4,600 tonnes copper, 20,800 oz. gold and 339,600 oz. silver.

With mining reserves of 9.8 million tonnes averaging 4.29% zinc and 0.79% copper, plus 34.5 grams silver and 1.2 grams gold per tonne, the mine life is expected to be at least 12 years.