Mining News: Northern Neighbors: AuRico agrees to pay a premium for Kiska

AuRico Metals Inc. Dec. 23 announced that it has entered into a definitive agreement to acquire all of the issued and outstanding securities of Kiska Metals Corp. Under the terms of the agreement, Kiska shareholders will receive 0.0667 AuRico common shares and C1.6 cents in cash for each Kiska share held. Based on AuRico's Dec. 22 closing share price, this values the Kiska shares at roughly C7.8 cents each, or roughly a 95 percent premium to Kiska shares on Dec. 22. The total value of this arrangement is about C$9.6 million. AuRico and Kiska’s portfolios are complimentary, as both companies have a combination of mining royalty and mineral exploration assets in Canada. Toronto-based AuRico’s gold royalty assets include a 1.5 percent net smelter royalty on the Young-Davidson gold mine; a 0.25 percent NSR royalty on the Williams Mine at Hemlo; and a 0.5 percent NSR royalty on the Eagle River Mine – all in Ontario. AuRico also has a 2 percent NSR royalty on the Fosterville Mine and a 1 percent NSR royalty on the Stawell Mine, both in Australia. Aside from its royalty portfolio, AuRico owns the Kemess, an advanced gold-copper project in northern British Columbia. AuRico recently released a feasibility study for Kemess and is working towards gaining the permits needed to develop an underground mine there. One of Kiska’s primary assets is Kliyul, an advanced copper-gold exploration project about 50 kilometers (30 miles) south of Kemess. Additionally, Kiska's portfolio consists of six existing royalties and five exploration projects in North America, including the Copper Joe project in Alaska.

-Shane Lasley