Canada’s Agnico Eagle Mines (TSX, NYSE: AEM) said on Wednesday it will sell its 55% interest in the Barsele gold project in northern Sweden, exiting direct ownership while retaining a royalty and a larger equity position in partner Goldsky Resources (TSX-V: GSKR).
Agnico will receive $20 million in cash and 75.5 million Goldsky shares valued at C$2.64 each, making Goldsky Barsele’s sole owner and operator. Goldsky will also grant Agnico’s Swedish unit a 2% net smelter return royalty on Barsele.
The deal is expected to close by June 30 this year, subject to TSX Venture Exchange and Goldsky shareholder approvals.
After closing, Agnico Eagle’s ownership in Goldsky will rise to about 32.5% of outstanding shares on a non-diluted basis, from roughly 4.1%. Agnico will control 82.9 million Goldsky shares.
Under an amended investor rights agreement, Agnico Eagle will have the right to participate in future equity financings to maintain its ownership up to 19.99%. It may also nominate one to three directors to Goldsky’s board, though it said it has no current plans to do so.
The sale is part of efforts by Agnico to optimize its portfolio, according to the company. While exploration over the past decade expanded Barsele’s mineral resources, further work is needed to advance the project toward development.
Barsele is located in Västerbottens Län, about 600 km north of Stockholm. Agnico Eagle operates mines in Canada, Australia, Finland and Mexico.
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