With Hecla Mining‘s (NYSE: HL) takeover of Klondex Mines now completed, the resulting Klondex spinoff company Havilah Mining (TSXV: HMC) has started trading as of July 25, with its primary listing on the TSX Venture Exchange.
In a deal first announced on March 19 and closed on July 20, Hecla acquired all outstanding Klondex shares for US$153 million and 75 million Hecla shares.
Hecla was pursuing Klondex’s gold mines and exploration assets in Nevada, and spun out Klondex’s Canadian gold assets as Havilah.
As part of the transaction, Hecla subscribed for 3.54 million Havilah shares in a private placement priced at $2.61 per share for a gross purchase price of $9.2 million, or US$7 million, resulting in Hecla owning 13.46% of Havilah’s shares. Hecla says the Havilah shares were acquired for investment purposes and it does not have any “present intention to acquire ownership of, or control over, additional securities” of Havilah.
Led by interim CEO Blair Schultz, Havilah’s most advanced asset is the True North gold mine and mill complex in Bissett, Manitoba.
Klondex put True North on care and maintenance three years ago, after the mine produced 390,000 oz. gold between 2005 and 2015. Since first production in 1931, the mine has intermittently produced 1.5 million oz. gold in total.
Havilah continues to reprocess tailings at the site to generate some cash flow.
At midday on July 25, Havilah shares were trading at 65¢ on volume of 225,000 shares.
Havilah Mining is unrelated to the established Australian gold producer Havilah Resources (ASX: HAV).
The name “Havilah” is a reference to a phrase from the second book of Genesis: “And a river went out of Eden to water the garden; and from thence it was parted, and became into four heads. The name of the first is Pison: that is it which compasseth the whole land of Havilah, where there is gold.”
The name is awful.