(all amounts are in US dollars unless otherwise indicated)
Dec. 17, 2012
AuRico Gold Inc. (TSX: AUQ) (NYSE: AUQ),
("AuRico" or the "Company") announces that following its receipt of gross proceeds of
relating to the recent sale of the Ocampo mine, the Board of Directors has authorized the making of a substantial issuer bid, pursuant to which the Company will offer (the "Offer") to purchase for cancellation up to 36,144,578 of its outstanding common shares (the "Shares") for an aggregate purchase price not exceeding
. AuRico anticipates that the Offer will commence on or about
December 18, 2012
and be completed in late
, unless extended or withdrawn. The Company intends to fund purchases of Shares pursuant to the Offer from the Ocampo proceeds and has used
of the proceeds to retire its existing debt facility.
The Offer will proceed by way of a "modified Dutch auction", pursuant to which AuRico shareholders may deposit all or a portion of their Shares at a price within a range of not less than
per Share and not more than
per Share (with increments of
per Share within that range). The modified Dutch auction tender process allows shareholders to individually select the price, within the specified range, at which they are willing to sell all or a portion of their Shares. When the Offer expires, AuRico will select the purchase price of the tendered Shares which will be the lowest tendered price within the range of prices, enabling the Company to purchase up to the maximum number of Shares validly tendered to the Offer. All Shares tendered at or below the selected price level will be bought at the purchase price. If the aggregate cost to purchase the tendered Shares exceeds
, the Company will accept such Shares on a pro-rata basis.
All Shares tendered at prices higher than the final purchase price will be returned to shareholders.
The Offer will not be conditional on any minimum number of Shares being tendered to the Offer, but will be subject to other conditions customary for transactions of this nature. The Offer will remain open for acceptance until
January 23, 2013
, unless extended or withdrawn.
AuRico plans to commence the Offer and mail to shareholders the formal offer to purchase, issuer bid circular and other related documents containing the terms and conditions of the Offer, instructions for tendering Shares and the factors considered by the Company and the Board in making its decision to authorize making the Offer, among other things, on or about
December 18, 2012
The dealer managers for the Offer are, in
, RBC Dominion Securities Inc. and, in
the United States
, RBC Capital Markets, LLC.
"Following the close of the sale of Ocampo that was recently announced,
the Company has used a portion of the gross proceeds to pay down the drawn balance under its existing debt facility and has launched a
substantial issuer bid. These initiatives follow on our commitment to eliminate certain debt obligations, return cash to shareholders and underscores our growing confidence in the value of our streamlined asset base," stated
, President and CEO. He continued, "
is now uniquely positioned with a growing free cash flow per share profile driven by expanding production from our two low cost mines, and a peer-leading balance sheet. We will continue to evaluate further opportunities for shareholder friendly initiatives, including our intention to announce a dividend policy in conjunction with the release of our year-end financial results."
Press Release for Informational Purposes Only
This press release is for informational purposes only, and does not constitute an offer to buy or the solicitation of an offer to sell any Shares. The solicitation and the offer to buy Shares will be made only pursuant to the separate formal offer to purchase and issuer bid circular and other related documents. The Company will file the offer to purchase and issuer bid circular and other related documents with Canadian securities regulatory authorities and a tender offer statement on Schedule TO (including the offer to purchase and issuer bid circular and other related documents) with the United States Securities and Exchange Commission (the "SEC"). The offer to purchase and issuer bid circular, the related letter of transmittal and certain other documents will be delivered without charge to all holders of Shares. The tender offer statement will be available without charge at the SEC website at
. Offer documents required to be filed in
will also be available without charge at
Neither the Company nor its Board makes any recommendation to shareholders as to whether to tender or refrain from tendering their Shares to the Offer. Shareholders should carefully read the tender offer statement, the offer to purchase and issuer bid circular and the other related documents because they will contain important information, including the various terms and conditions of the Offer. Shareholders are also urged to consult their own financial, tax and legal advisors and to make their own decisions whether to tender or to refrain from tendering their Shares to the Offer and, if so, how many Shares to tender and at what price or prices.