Royal Oak moves to buy El Condor

Gold producer Royal Oak Mines (TSE) intends to acquire El Condor Resources (VSE) for about $95 million.

El Condor’s principal asset is a 60% interest in the Kemess South gold-copper deposit in north-central British Columbia. It also owns a 100% interest in Kemess North.

Royal Oak has agreed to pay $4.90 per share plus one-third of a Royal Oak common share for each El Condor common share. The producer says the cash portion of the deal — $71 million — will be funded from its treasury.

Royal Oak says the deal is conditional upon its being satisfied with the status of various certification matters pertaining to Kemess South and various forms of provincial financial assistance being available for project development.

Kemess South is estimated to contain minable reserves of 4.1 million oz. and 990 million lb. copper; Kemess North is estimated to host 1.9 million oz. gold and 623 million lb. copper.

In a related move, Geddes Resources (TSE), owned 39% by Royal Oak, says it intends to acquire St. Philips Resources (VSE) for about $37 million ($3.25 per share). St. Philips owns the remaining 40% interest in Kemess South.