Great Bear Resources (TSX-V:GBR) Ltd revealed that its security holders have approved a plan of arrangement that will result in its takeover by Kinross Gold Corp in a deal valued at about C$1.8 billion.
The Vancouver-based gold exploration company said the transaction was approved by 97.8% of the votes cast by security holders present or represented by proxy at a special meeting held on February 14, 2022.
Under the terms of the deal, security holders were able to elect to receive C$29 per Great Bear share in cash or 3.8564 Kinross shares per Great Bear share, both subject to pro-ration to ensure maximum cash consideration of approximately $1.4 billion and a maximum of approximately 80.7 million Kinross common shares issued as the initial consideration. Shareholders who did not make an election will receive the all-cash consideration, subject to pro-ration, the company said.
READ: Great Bear Resources and its Dixie gold project snapped up by Canadian major Kinross in C$1.8 billion deal
The acquisition price represents a premium of 40% to Great Bear's volume-weighted average price (VWAP) for the 20 days to December 7, 2021. Additionally, Great Bear securityholders will also receive contingent value rights providing for further potential consideration equal to 0.1330 of a Kinross common share per Great Bear share.
This contingent consideration will be payable when Kinross publicly declares commercial production at the Dixie project, provided that at least 8.5 million gold ounces of measured and indicated mineral resources have been disclosed.
Great Bear, which recommended that its shareholders vote in favour of the deal, said the transaction remains subject to the approval of the Supreme Court of British Columbia and the satisfaction of other customary conditions.
The Court hearing for the final order to approve the transaction is currently scheduled to take place on February 16, 2022, and the transaction is expected to close on or before the end of February 2022. On January 2, 2022, the Commissioner of Competition issued an advance ruling certificate.
Following completion of the transaction, Great Bear said its shares are expected to be delisted from the TSX-V and OTCQX.
Contact the author at stephen.gunnion@proactiveinvestors.com