Eldorado buys Foran for $2.8B in copper push

Eldorado Gold (TSX: ELD; NYSE: EGO) has agreed to buy fellow Canadian miner Foran Mining (TSX: FOM; US-OTC: FMCXF) in a transaction that values the copper-focused developer at about $3.8 billion (US$2.8 billion).

The deal brings together Eldorado’s Skouries gold-copper project in Greece and Foran’s McIlvenna Bay copper project in Saskatchewan, both targeted for commercial production this year. Eldorado said the enlarged group could produce about 900,000 gold-equivalent oz. in 2027.

The acquisition would expand Eldorado’s copper exposure and add a second near-term growth project as demand for the metal rises alongside electrification and clean energy investment.

Once combined, the company’s asset base is expected to be weighted about 77% to gold and 15% to copper, with operations and development projects in Canada, Greece and Turkey. The new company would generate about $2.1 billion in core profit and $1.5 billion in free cash flow in 2027.

Deal insights

Shares in Eldorado Gold dropped 8.5% to $53.45 apiece on Monday in Toronto, valuing the company at $10.3 billion, as metals and mining stocks weathered a sell-off on Friday. Foran Mining fell 7.9% to $6.07 each for a market capitalization of $3.1 billion. 

Under the terms of the agreement, Foran shareholders will receive 0.1128 Eldorado shares plus $0.01 per share, giving them about 24% of the combined company. The transaction is expected to close in this year’s second quarter.

“This transaction gives McIlvenna Bay the scale and financial strength to fully realize its potential, including the ability to accelerate phased expansion opportunities over time,” Foran CEO Dan Myerson said in the statement.

The combined company will remain headquartered in Vancouver under the Eldorado Gold name. 

Cornerstone assets

McIlvenna Bay is expected to become a cornerstone Canadian asset alongside Eldorado’s Lamaque Complex in Quebec, supporting long-term employment and economic activity in Saskatchewan and across Canada, the company said. 

The project has been recognized by the federal government as a critical minerals development and referred to the new Major Projects Office as a potential project of national interest.

Both boards have unanimously approved the transaction, and shareholder votes are scheduled by April 14, the companies said.