Agnico Eagle Mines Limited acquired Cumberland Resources Ltd. for ~C$710 million (all-share; 0.185 Agnico share per Cumberland share).
Agnico Eagle agreed to acquire all of Cumberland Resources it did not already own through a share-exchange offer of 0.185 of an Agnico share per Cumberland share, valuing Cumberland at approximately C$710 million and representing about a 28.8% premium. Cumberland owned 100% of the Meadowbank gold project in Nunavut, then under construction with proven and probable reserves of about 2.9 million ounces. Meadowbank became Agnico's first mine in Nunavut.
Agnico said the transaction would increase gold production and reserve growth and be accretive to net asset value, cash flow per share and reserves per share, establishing a Nunavut foundation it would build on for years.
The acquisition of Cumberland is expected to enhance our already significant gold production and reserve growth and is a logical next step in our strategy of building a premier international gold growth company. The transaction is expected to be accretive to our underlying net asset value, cash flow per share and reserves per share. Furthermore, we anticipate that the Meadowbank project's substantial reserve base will grow as we accelerate the exploration program in 2007.
Advisory firms were not disclosed for this transaction.