Shareholders of junior Cadiscor Resources (CAO-V) voted unanimously in favour of becoming a wholly owned subsidiary of North American Palladium (PDL-T, PAL-X).
Each Cadiscor shareholder will receive 0.33 of a share in North American Palladium and all of Cadiscor’s outstanding stock options, warrants and debentures will become stock options, warrants and debenture of North American Palladium, using the same exchange ratio. The transaction will close on May 26.
As part of the agreement NAP has already advanced $7.5 million to Cadiscor in the form of two 18-month notes, which Cadiscor has used to restart development at its Sleeping Giant gold mine in Quebec. So far it has started to hire personnel and begun development to restart gold production. The company believes production will begin again at the mine in the fourth quarter.
North American Palladium’s Lac des Iles mine in Thunder Bay is one of the largest palladium mines in North America and historically has produced about 4% of the world’s palladium supply.
The mine was placed on temporary care and maintenance in October last year due to low metal prices. Prior to the shutdown, the mine had annual production of 270,000 ounces of palladium, 20,000 ounces of platinum and 20,000 ounces of gold.
Lac des Iles has a measured and indicated resource of 36 million tonnes grading 3.18 grams of palladium per tonne for a total insitu resource of 3.7 million ounces of palladium.
In mid-morning trading in Toronto, Cadiscor was trading at 87¢ per share. The company has a 52-week trading range of 13¢-94¢ and 43.32 million shares outstanding.
North American Palladium was trading at $2.69 per share and has a 52-week range of $1.14-$6.40 per share with 86.8 million shares outstanding.
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