Coeur Mining (NYSE: CDE) is buying Northern Empire Resources (TSXV: NM; US-OTC: PSPGF) and its 143 sq. km Sterling gold project, located 185 km from Las Vegas in the Walker Lane trend.
The deal values Northern Empire at $117 million, inclusive of the 7.4 million shares, or 11% of the company, Coeur already owns. It values each Northern Empire share at $1.64, a 20% premium over the company’s closing share price on Aug. 1, 2018.
Coeur says it will focus on restarting the fully permitted open-pit Sterling mine which was in production as recently as 2015. It will also continue to explore the remaining deposits, collectively called the Crown Block.
The 8 km Crown Block trend hosts four deposits and 17 untested targets. Northern Empire holds three of the deposits: Daisy, Secret Pass and SNA. Corvus Gold’s (TSX: KOR; US-OTC: CORVF) Mother Lode gold project is the fourth.
At a 1 gram gold cut-off grade, the Sterling deposit contains 1.95 million inferred tonnes grading 3.67 grams gold per tonne for 231,000 oz. gold; Daisy contains 2.55 million inferred tonnes grading 2.12 grams gold for 174,000 oz. gold; Secret Pass contains 3.53 million inferred tonnes at 1.65 grams gold for 188,000 oz. gold; and SNA contains 1.51 million tonnes at 1.61 grams gold for 78,000 oz. gold.
The Sterling deposit also contains a non-pit constrained resource of 350,000 tonnes grading 3.38 grams gold for 38,000 oz. gold at a 1.7 grams gold cut-off grade that Coeur could target with underground mining.
Shares of Northern Empire soared nearly 20¢ to $1.56 on news of the deal. They are now valued at $1.54 with a 52-week range of 59¢ to $1.62. The company has a $107 million market capitalization.
Shares of Coeur Mining are currently valued at US$6.54 with a 52-week range of US$6.54 to US$9.87. The company has a US$1.26 billion market capitalization.
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