Golden Knight, Repadre Capital tie knot

An agreement between Golden Knight Resources (GKR-T) and Repadre Capital (RPD-T) sets the stage for their consolidation.

The proposed merger would see one share of Golden Knight exchanged for 0.125 of a share of Repadre and 33 cents in cash, or 0.2 of a share and 0.2 of a warrant. Each warrant would entitle the holder to buy an additional share at $4 per share for up to three years and receive 10 cents in cash.

The companies are carrying out a due diligence review, which is to be completed shortly. A final agreement would still have to receive regulatory, judicial and shareholder approval. Teck (TEK-T), which holds 24.5% of Golden Knight’s outstanding shares, has already agreed to vote in favor of the deal.

Golden Knight owns varying interests in eight concessions in Ghana and neighboring Burkina Faso, as well as a large block of claims near Timmins, Ont. Among these is the producing Tarkwa gold mine in southwestern Ghana. Golden Knight holds a 17.5% interest in that mine’s owner, Gold Fields Ghana.

Tarwka was targeted to produce 135,000 oz. gold in 1998, and had churned out 48,612 oz. by the end of the third quarter. A second phase of expansion, now under way, is expected to double annual production to 250,000 oz., and subsequently lower cash costs to US$200 per oz.

Repadre’s portfolio consists of royalties in 20 gold and precious metals properties, nine of which are producing. It also holds $35 million in cash and $26 million in securities, and recently increased to 15.1% its interest in Addwest Minerals International (ADU-V).