Torex Gold (TSX: TXG) appears to be on a bit of a buying spree, with the company this morning announcing that it has reached a definitive agreement to acquire Prime Mining (TSX: PRYM), only weeks after announcing the acquisition of Reyna Silver (TSXV: RSLV).
The transaction is centered around Prime’s Los Reyes gold-silver project in Mexico, which boasts indicated resources of 1.5 million ounces of gold and 54.0 million ounces of silver, alongside inferred resources of 538,000 ounces of gold and 21.6 million ounces of silver. The purchase is expected to diversify Torex’s asset base while enhancing medium and long term growth potential.
“The Los Reyes Project represents a unique opportunity for the Torex team to develop a high-quality asset with the potential for a high margin, low capital, and long-life operation in a jurisdiction that we know very well. The acquisition of Prime Mining, and the previously announced all-cash acquisition of Reyna Silver, support our strategy to systematically build a diversified, Americas-focused precious metals producer with a portfolio of producing, development, and exploration stage assets,” commented Jody Kuzenko, CEO of Torex.
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Under the terms of the transaction, Prime Mining shareholders are to receive 0.06 of a common share of Torex for each Prime Mining share held, a ratio which implies a premium of 32.4% to the 30-day volume weighted average price of Prime. The figure represents consideration of $2.57 per share and a total equity value of $449 million.
A total of 10.5 million shares are expected to be issued in connection with the transaction, with Prime shareholders to own 10.7% of the resulting company.
Closing of the transaction remains subject to shareholder approval by Prime Mining shareholders, with 23% of the vote already locked up in favor of the transaction, including from Pierre Lassonde, a major shareholder of Prime. The transaction is expected to close in the second half of 2025, subject to clearance under Mexican antitrust laws.
Torex Gold last traded at $42.85 on the TSX.
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