New Found Gold (TSXV: NFG) evidently has its sights set on becoming a gold producer, with the company this morning announcing a definitive agreement to acquire Maritime Resources (TSXV: MAE). The arrangement is expected to establish a multi-asset near term gold producer, thanks in part to Maritime’s Hammerdown Gold project, which is expected to enter production next year.
“From day one, the focus of our new board and management team has been to rapidly advance to cash flow and transform New Found Gold from an exploration company to a gold producer. This acquisition positions New Found Gold as an emerging producer with gold production expected to commence next year. The synergies obtained by this combination derisks Queensway, providing access to a milling facility and near-term cash flow to support Phase I development, setting the stage for Queensway to commence production in 2027,” commented Keith Boyle, CEO of New Found Gold.
The strategic rationale behind the transaction centers around Maritime’s Hammerdown project, found 180 kilometres to the northwest of New Found Gold’s Queensway project. Ongoing construction at Hammerdown is targeting a ramp up to full production in early 2026, with a 2022 feasibility study outlining an operation that will produce 50,000 ounces of gold annually for a life of mine of roughly five years at an AISC of US$912 an ounce.
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Post-transaction, cash flow from the Hammerdown mine is expected to support the development of Queensway, while on-site infrastructure will also be used for the processing of material from Queensway.
Under the terms of the transaction, Maritime shareholders are to receive 0.75 of a share of New Found Gold for each share of Maritime currently held. The ratio is said to imply a premium of 56% to the closing price of Maritime shares on July 30, the day prior to which a letter of intent was entered into between the two parties. However the price implies a premium of just $0.07 to yesterday’s closing price of the equity. The transaction values Maritime at $292 million.
The transaction remains subject to approval by shareholders of Maritime, as well as regulatory and court approvals. A $13 million termination fee is also in play.
The transaction is currently expected to close in the fourth quarter of 2025.
New Found Gold last traded at $2.60 on the TSX Venture.
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