Business
Royal Gold to Acquire Battle Mountain Gold Exploration
Royal Gold to Acquire Battle Mountain Gold Exploration.
About this update from Red Lake Gold Inc
[{"type":"text","content":"\n\n\n\nDENVER, March 5 /CNW/ -- ROYAL GOLD, INC. (Nasdaq: RGLD; Toronto: RGL)\nand Battle Mountain Gold Exploration Corp. (OTC Bulletin Board: BMGX) ("Battle\nMountain") today announced that Battle Mountain has accepted Royal Gold's\nproposal to acquire 100% of the fully diluted shares of Battle Mountain for\napproximately 1.57 million shares of Royal Gold common stock in a merger\ntransaction. This represents a value of $0.60 per fully diluted share of\nBattle Mountain, or a 29% premium to the 20-day weighted average trading price\nof Battle Mountain as of Friday, February 23, 2007. The proposal is subject\nto satisfactory completion of due diligence, definitive documentation, and\nreceipt of a fairness opinion satisfactory to Royal Gold's Board of Directors,\namong other conditions.\n\n\nTo ensure continuity of Battle Mountain's business, Royal Gold and Battle\nMountain also entered into a binding term sheet, as of February 28, 2007, to\nprovide up to $20 million in bridge financing to satisfy debt obligations and\nfinalize royalty acquisitions. The bridge loan is convertible into Battle\nMountain common stock at the election of Royal Gold, at $0.60 per share.\n\n\nBattle Mountain is a precious metals royalty company with a portfolio\nconsisting of 12 properties located mainly in the Americas. Their principal\nassets include a 1.25% net smelter return ("NSR") royalty on gold production\nfrom the Dolores project in Mexico, under development by Minefinders\nCorporation Ltd. Battle Mountain also has an option to acquire an additional\n2.0% NSR royalty on gold and silver production from the Dolores project.\nIncluding the option, Battle Mountain's properties contain approximately 4.8\nmillion ounces of gold reserves and 136 million ounces of silver reserves(1).\n\n\nTony Jensen, Royal Gold's President and CEO, stated, "This transaction\nwill further diversify our portfolio of producing royalties and strengthens\nour pipeline of development-stage assets, with the Dolores project expected to\ncommence production later this year. We are pleased with both the near-term\nand long-term financial impacts this transaction will have on Royal Gold and\nwill continue to remain vigilant in our search for further accretive\nopportunities."\n\n\nMark Kucher, Battle Mountain Chairman and CEO, commented, "We ar...