Agnico Eagle to acquire O3 Mining at C$1.67 per common share in cash

Agnico Eagle (AEM) announced that they have entered into a definitive support agreement, pursuant to which Agnico Eagle has agreed to offer to acquire, directly or indirectly, all of the outstanding common shares of O3 Mining at C$1.67 per common share in cash by way of a take-over bid. The offer is valued at approximately C$204M on a fully diluted in-the-money basis. The offer price of C$1.67 per common share represents a premium of 57% to the volume weighted average price of the common shares on the TSX Venture Exchange for the 20-day period ended December 11. O3 Mining’s primary asset is its 100%-owned Marban Alliance property located near Val d’Or, in the Abitibi region of Quebec, and is adjacent to Agnico Eagle’s Canadian Malartic complex. The Marban Alliance property includes the Marban deposit, which is an advanced exploration project that could support an open pit mining operation similar to Agnico Eagle’s Barnat open pit operations at the Canadian Malartic complex. O3 Mining has estimated that the Marban pit contains 52.4M tons of indicated mineral resources grading 1.03 g/t gold for 1.7M ounces of gold and 1M tons of inferred mineral resources grading 0.97 g/t gold for 32,000 ounces of gold. O3 Mining also owns 100% of the Alpha property and 100% of the Kinebik property. The potential integration of the Marban Alliance property to the Canadian Malartic land package will create significant and unique synergies by leveraging Agnico Eagle’s regional operational expertise and existing infrastructure, including the Canadian Malartic mill and existing open pit workforce and equipment fleet. Agnico Eagle, through a wholly-owned subsidiary, Agnico Eagle Abitibi Acquisition Corp., intends to formally commence the offer by mailing a take-over bid circular to O3 Mining shareholders on or about December 19 and O3 Mining’s directors’ circular is also expected to be mailed to O3 Mining shareholders on or about that date. The offer will be open for acceptance for a minimum of 35 days following the date of commencement. Accordingly, the offer will be open for acceptance until 5:00 p.m. on January 23, 2025. The offer is conditional upon, among other conditions, there having been deposited pursuant to the offer and not withdrawn at the expiry of the initial deposit period not less than two-thirds of the common shares then outstanding, excluding the common shares beneficially owned, or over which control or direction is exercised, by Agnico Eagle and any person acting jointly or in concert with Agnico Eagle. Agnico Eagle owns 906,238 common shares, representing approximately 0.8% of the outstanding common shares on a basic basis, and holds 270,000 warrants to purchase common shares and a senior unsecured convertible debenture of O3 Mining in the principal amount of C$10M that is convertible into 4,878,049 common shares at a price equal to C$2.05 per common share. Upon the exercise of such warrants and conversion of the convertible debenture, Agnico Eagle would own 6,054,287 common shares, representing approximately 5.3% of the outstanding common shares on a partially-diluted basis.