TSX - CRJ
NYSE Amex - CGR
Oct. 25, 2011
/PRNewswire/ - Claude Resources Inc. (TSX: CRJ) (NYSE Amex: CGR) ("Claude") and St. Eugene Mining Corporation Limited (TSXV: SEM) ("St. Eugene") jointly announce that they have entered into a definitive agreement pursuant to which Claude will acquire, by way of a court-approved plan of arrangement, all of the shares of St. Eugene that it does not already own. The consideration for the purchase of 100% of the fully diluted in the money shares of St. Eugene is approximately
plus Spinco (defined below), which will hold the Tartan Lake Gold Mine Project.
The Share Consideration (defined below), based upon the 20 day volume weighted average price ("VWAP") of the common shares of Claude on the TSX on
October 24, 2011
common share, a 28% premium to the 20 day VWAP of the common shares of St. Eugene on the TSXV on
October 24, 2011
and a 53% premium to the 20 day VWAP of the common shares of St. Eugene on the TSXV on
July 8, 2011
(the last trading day prior to Claude's original approach to
Under the terms of the transaction, each shareholder of
will receive 0.0789 of a Claude share per
share (the "Share Consideration"). Additionally, at closing, each
shareholder will receive 0.25 common shares of a newly formed, wholly-owned, subsidiary of
("Spinco") in respect of each
share. Spinco will be transferred
interests in the Tartan Lake Gold Mine Project and approximately
in cash. Claude will maintain its pro-rata stake in Spinco. In addition, Claude will reduce its existing net smelter return royalty on the Tartan Lake Gold Mine Project from a sliding scale to 2%. The net smelter return royalty can be repurchased at any time by Spinco for
per each 1%. It is anticipated that the current members of the board of directors of
will sit as board members of Spinco.
The proposed transaction is the logical consolidation of the Amisk Gold Project.
shareholders will benefit from a meaningful premium, the increased liquidity of their investment, exposure to the current gold price through production at the Seabee operation and outstanding exploration upside on Claude's Seabee, Amisk and
The Amisk Gold Project's independent NI 43-101 resource estimate (completed by SRK Consulting Inc. and released on
, 2011) resulted in an indicated mineral resource of 921,000 AuEq ounces at 0.95 g/t AuEq and an additional inferred mineral resource of 645,000 AuEq ounces at 0.70 g/t AuEq. If this transaction is approved, Claude's interest in the Amisk Gold Project will increase from 65% to 100%.
The Special Committee of
comprised of independent directors received a verbal opinion from its financial advisor that the consideration to be received by the
shareholders is fair from a financial point of view to the shareholders of
. The Board of Directors of
has unanimously recommended the transaction. In addition, the directors and senior officers of
holding an aggregate 2% and a shareholder holding approximately 9% of the basic share capital of
have entered into voting agreements with Claude. Combined with the shares that Claude already owns this represents 20% in favour of the transaction. The transaction is subject to the affirmative vote of 66 2/3% of
shareholders and is expected to close prior to
December 31, 2011
The completion of the transaction is subject to customary closing conditions, including the receipt of any required regulatory approvals. In the event that the transaction is not completed,
has agreed to pay Claude a termination fee of
, under certain circumstances.
has also provided Claude with certain other customary rights, including a right to match any competing offers.
Dundee Securities Ltd. has acted as financial advisor to Claude and Primary Capital Inc. has acted as financial advisor to
Claude Resources Inc. is a public company based in
, whose shares trade on the Toronto Stock Exchange (TSX-CRJ) and the NYSE Amex (NYSE Amex-CGR). Claude is a gold exploration and mining company with an asset base located entirely in
. Since 1991, Claude has produced over 950,000 ounces of gold from its Seabee mining operation in northeastern
. The Company also owns 100 percent of the 10,000 acre Madsen Property in the prolific
gold camp of northwestern
and currently has a 65 percent working interest in the Amisk Gold Project in northeastern
-based exploration company that is actively exploring for and developing gold properties, both in
. The Company's three main assets are the Tartan Lake Gold Mine Project in
(100% interest), and, in
, the Amisk Gold Project (35% interest
- 65% interest Claude) and the Amisk North Gold Project (100% interest). All three assets are located in the prolific Flin Flon Greenstone Belt. The Tartan Lake's Gold Mine Project's independent NI 43-101 resource estimate (completed by MineTech International Ltd. and released on
November 8, 2010
) resulted in an indicated mineral resource of 1,000,000 tonnes at 4.0g/t Au (130,000 ounces) and an additional inferred mineral resource of 1,900,000 tonnes at 3.9g/t Au (240,000 ounces).
For the Amisk Gold Project,
, P.Eng., Senior Vice President, Mining Operations and
, P.Geo., Vice President, Exploration, Qualified Persons, have reviewed and approved the contents of this news release.
For the Tartan Lake Gold Mine Project,
, P.Geo., Vice President, Exploration and Qualified Person, has reviewed and approved the contents of this news release.
CAUTION REGARDING FORWARD-LOOKING INFORMATION
This Press Release may contain 'forward-looking' statements regarding the plans, intentions, beliefs and current expectations of the Company, its directors, or its officers with respect to the future business activities and operating performance of the Company. The words "may", "would", "could", "will", "intend", "plan", "anticipate", "believe", "estimate", "expect" and similar expressions, as they relate to the Company, or its management, are intended to identify such forward-looking statements. Investors are cautioned that any such forward-looking statements are not guarantees of future business activities or performance and involve risks and uncertainties, and that the Company's future business activities may differ materially from those in the forward-looking statements as a result of various factors. Such risks, uncertainties and factors are described in the periodic filings with the Canadian securities regulatory authorities, including the Company's Annual Information Form and quarterly and annual Management's Discussion & Analysis, which may be viewed on SEDAR at
. Should one or more of these risks or uncertainties materialize, or should assumptions underlying the forward-looking statements prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated, believed, estimated or expected. Although the Company has attempted to identify important risks, uncertainties and factors which could cause actual results to differ materially, there may be others that cause results not anticipated, estimated or intended. The Company does not intend, and does not assume any obligation, to update these forward-looking statements.
SOURCE St. Eugene Mining Corporation Limited