Thompson Creek Metals has emerged as the sole owner of Terrane Metals Corp. after closing transactions with Goldcorp and Terrane shareholders.
Goldcorp will receive an aggregate of C$240.5 million in cash plus 13.9 million common shares of Thompson Creek (representing approximately 8 percent of Thompson Creek's issued and outstanding shares).
Terrane Metals is an exploration and mine development company focused on the development of the Mt. Milligan copper-gold and Berg copper-molybdenum-silver projects in British Columbia, Canada.
Goldcorp Inc. owned a 52.4 percent equity interest in Terrane prior to the deal with Thompson Creek, which already had a Plan of Arrangement with Terrane to acquire the interests of Terrane shareholders for C$0.90 in cash and 0.052 of a Thompson Creek share per Terrane share. Both deals have now successfully closed.
"Mt. Milligan is a high quality copper-gold project that is ready to move into construction," said Chuck Jeannes, president and chief executive officer of Goldcorp. "The Terrane team has done a great job advancing the project. Thompson Creek provides the financial strength and management to build and operate the mine, bringing benefits to British Columbia and shareholders of both companies. We look forward to being a significant shareholder of Thompson Creek. Goldcorp will deploy the cash proceeds toward the continued development of its industry-leading suite of core gold projects."
Thompson Creek Metals Company Inc. is a growing, diversified, North American mining company with two operating molybdenum mines and a number of additional metals properties in various stages of development. All operations are located in the United States or Canada.
Kevin Loughrey, chairman and chief executive officer of Thompson Creek, commented, "Today is a very special day for our company and our shareholders as we complete our first major acquisition and evolve Thompson Creek from a pure molybdenum producer to a diversified base metals company.
“We are excited to begin construction of the Mt. Milligan project,” he continued, “which we expect will generate substantial growth in revenues for the company when it is completed."
At the same time, Thompson Creek has completed a gold stream transaction with royalties firm Royal Gold, whereby the latter has acquired the rights to 25 percent of the payable gold from the Mt. Milligan project. Total consideration for the transaction was US$311.5 million, of which $226.5 was paid in conjunction with the closing of the arrangement, and the remaining $85.0 million to be paid during construction of the Mt. Milligan project.
The Mount Milligan project is under construction with production expected to start in 2013. The area will be developed as an open pit mine over the next two and a half years, and average annual production over the 22-year lifespan of the mine is forecasted at 81 million pounds of copper and 194,000 ounces of gold. The site is expected to create 400 permanent jobs.
