Nord Gold, Russia's third-largest gold producer, plans to buy the 25 per cent that it does not already own in High River Gold Mines, in a deal valuing the Canadian-listed miner at $1.2 billion.
Nord Gold is offering 0.285 of its global depositary receipts for each High River share held, or C$1.40 in cash, representing a 17.2 per cent premium based on the stock's closing prices on 17 July on the London Stock Exchange.
Nord Gold said it has executed lock-up agreements with a number of substantial High River minority shareholders, including three of the largest shareholders, as well as with former members of High River executive management.
Toronto, Canada-based High River is a gold company with gold producing and development mines in Russia and Burkina Faso.
It has three producing mines in Russia and one in Burkina Faso and a 90 per cent stake in a development project in Burkina Faso, and a 50 per cent stake in Russia.
High River has 8.10 million ounces of gold reserves and 2.05 million ounces of silver.
Amsterdam, Netherlands-based Nord Gold was founded in 2007 as the gold producing division of Russia's largest steel producer OAO Severstal. In January 2012, Nord Gold was spun-off from Severstal and commenced trading as an independent public company via a listing of GDRs on the London Stock Exchange.