Gatling Exploration To Be Acquired By MAG Silver For $0.40 Per Share

Consolidation is in the air within the junior mining space. MAG Silver (TSX: MAG) this morning announced that it has reached a definitive agreement to acquire that of Gatling Exploration (TSXV: GTR), a junior firm focused on a gold project in Northern Ontario.

The arrangement will see MAG acquire the junior exploring in an all-stock transaction, with Gatling shareholders to receive 0.01702627 shares of MAG for each share held. That figure represents approximately $0.40 per share as of yesterdays close, a premium of 47.4% based on the five day weighted average price., or a premium of $0.13 per share based on yesterdays close of $0.27.

With 45.4 million shares outstanding, it translates to a purchase price of roughly $18.2 million. Post closing, Gatling shareholders will own roughly 0.79% of MAG Silver, with the current conversion rate resulting in an estimated 772,992 shares being issued.

Evidently the basis for the transaction is that MAG wants to acquire Gatling’s Larder Gold Project, located along the Cadillac-Larder Lake Break in the Abitibi greenstone belt. The property currently covers 3,370 hectares just 7 kilometres west of the Kerr Addison Mine.

The property currently features 4.5 kilometres of strike across three high grade deposits. A mineral resource estimate completed last year reported 388,000 indicated ounces of gold, as well as 933,000 inferred ounces, which was spread across all three deposits and found in both open pit and underground models.

The arrangement has seen MAG provide Gatling with a $3.0 million secured convertible bridge loan in the interim. The transaction remains subject to approval by Gatling shareholders, with the transaction expected to be completed by the end of May 2022.

Gatling Exploration last traded at $0.27 on the TSX Venture.


Information for this briefing was found via Sedar and the companies mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

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