Romarco Minerals Inc (RTRAF)

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OceanaGold Agrees to Buy Romarco Minerals in C$856 Million Deal -- Update
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5:45 AM ET 7/30/15 | Dow Jones
By Robb M. Stewart

MELBOURNE, Australia--OceanaGold Corp. (OGC.AU) has agreed to buy Romarco Minerals Inc. (R.T) in an all-stock deal valued at 856 million Canadian dollars (US$660.2 million) that the companies say will create a low-cost gold producer with output of about 540,000 troy ounces a year.

In a joint statement Thursday, the companies said Romarco shareholders would receive 0.241 OceanaGold share for each of their shares. That works out to the equivalent of C$0.68 a Romarco share, a 73% premium based on the Tuesday closing prices for the companies on the Toronto stock exchange.

Upon the deal's conclusion, OceanaGold shareholders will own about 51% of the new company and Romarco investors the remainder, the companies said.

The merged company expects to have an "all-in" production cost of less than US$600/oz, with about 75% of output coming from New Zealand and the U.S. by 2017, the companies said. The enlarged mining company will also benefit from greater financial flexibility, they said.

The deal is subject to approval by shareholders of OceanaGold and Romarco, with votes scheduled for late September or early October.

National Bank Financial Inc. is acting as financial adviser to OceanaGold, while RBC Capital Markets is advising Romarco, the companies said.

OceanaGold's operations include New Zealand's largest gold-mining operation at the Macraes Goldfield in Otago and the Didipio gold-and-copper mine in the Philippines. Romarco's key asset is the flagship Haile gold mine in South Carolina, which the company expects to begin production by the end of 2016.

Write to Robb M. Stewart at [e-mail]

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July 30, 2015 05:45 ET (09:45 GMT)

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