B2Gold Corp. and Auryx Gold Corp. announce that they have signed a definitive arrangement agreement relating to the previously announced business combination of B2Gold and Auryx.
The material terms of the Transaction are as previously disclosed and the Transaction remains subject to regulatory, court, and Auryx shareholder approvals. The date of the special meeting of Auryx shareholders to approve the Transaction is set for December 15, 2011 (the “Meeting”) and the record date for receiving notice of and the right to vote at the Meeting is November 10, 2011.
The combination of B2Gold and Auryx will result in B2Gold acquiring a 92% interest in the Otjikoto gold project in Namibia and a 100% interest in two additional exploration projects in Namibia. The Otjikoto gold project has forecast life of mine annual production of approximately 100,000 ounces of gold based on a Preliminary Economic Assessment released by Auryx in September 2011 with significant exploration upside. B2Gold is well placed to progress development at the Otjikoto gold project given its strong cash position, funding capacity and a management and technical team with significant mine development and operating experience.
The Auryx Board of Directors has approved the Transaction and unanimously recommended that Auryx shareholders vote in favour of the Transaction. Further, Auryx officers, directors and shareholders holding approximately 13.5% of the outstanding shares of Auryx have entered into lock-up agreements with B2Gold, pursuant to which they will vote their shares in favour of the Transaction. The B2Gold Board of Directors has also unanimously approved the Transaction.
Clive Johnson, President and Chief Executive Officer of B2Gold, stated, “We are pleased to take this important step towards the completion of the B2Gold / Auryx business combination. The Otjikoto project is a quality asset that can potentially contribute another 100,000 ounces of annual gold production to B2Gold’s impressive production growth profile. Our team looks forward to working with Auryx’s experienced team to advance their projects in Namibia. We are aware of the strong relationships that Auryx has built with local stakeholders, including the Government of the Republic of Namibia and Auryx local partners, EVI Gold, and we look forward to completing the transaction by the end of 2011 and jointly fast-tracking the development of the Otjikoto gold project. Further it establishes a beach-head for B2Gold to look for other opportunities in Africa.”
Tim Searcy, Chief Executive Officer of Auryx, stated, “We feel that B2Gold is an ideal party to grow and develop Otjikoto, and completing the Arrangement Agreement with them is a significant milestone towards that goal. Their track record at operations is superb and has demonstrated a strong commitment to working with local stakeholders, which is a value shared by Auryx. We look forward to reaping the benefits as B2Gold applies their skills and resources to Otjikoto and their impressive pipeline of exploration, development, and operating assets around the world
The Transaction will be carried out by way of statutory plan of arrangement under the Business Corporations Act (British Columbia). On closing of the Transaction, Auryx will become a wholly-owned subsidiary of B2Gold. Under the terms of the Transaction, it is expected that on a in the money fully diluted basis Auryx shareholders will receive as consideration, shares representing approximately 10.5% of B2Gold’s issued and outstanding shares following closing. Upon closing of the transaction B2Gold will issue 37.2 million shares in exchange for Auryx shares.
The Arrangement Agreement includes a commitment by Auryx not to solicit or initiate discussions concerning alternative transactions, including the sale of material assets. Auryx has agreed to pay a break fee of C$6,000,000 to B2Gold in certain circumstances and has granted B2Gold the right to match competing offers. Each party has also been provided with certain other rights, representations and warranties and covenants customary for a transaction of this nature.
Completion of the Transaction is subject to certain customary conditions, including the receipt of all necessary court and regulatory approvals, including the approval by the government of Namibia, and obtaining Auryx shareholder approval of the Transaction at the Meeting by not less than 66 2/3% of the outstanding common shares of Auryx.
Full details of the transaction will be included in a management information circular in respect of the Meeting to be filed with applicable Canadian securities regulatory authorities and mailed to Auryx shareholders in accordance with applicable Canadian securities laws. Auryx expects to mail the management information circular to the Auryx shareholders on or before November 18, 2011. The Transaction is expected to close by December 31, 2011.
GMP Securities L.P., Auryx’s financial advisor, with PowerOne Capital Markets Limited acting as co-advisor, has provided an opinion that based upon and subject to the assumptions, limitations, and qualifications stated in such opinion, the consideration proposed to be paid to the holders of Auryx common shares pursuant to the Transaction is fair from a financial point of view to such shareholders. B2Gold’s financial advisor is Macquarie Capital Markets Canada Inc.
B2Gold Corp. is a Vancouver based gold producer with two mines in Nicaragua and a strong portfolio of development and exploration assets in Nicaragua, Colombia and Uruguay. B2Gold was founded in 2007 by the former executive and management team of Bema Gold Corporation. Bema grew from a junior explorer to an international gold producer that was acquired by Kinross Gold Corporation through a C$3.5 billion transaction in February 2007. B2Gold’s corporate objective is to build further shareholder value through the exploration and development of existing projects and additional accretive acquisitions, capitalizing on the extensive experience and relationships that management has developed over the past 25 years. B2Gold trades on the Toronto Stock Exchange under the symbol “BTO” and on the OTCXQ under the symbol “BGLPF”.
Auryx Gold Corp. is a Canadian, growth-focused resource company engaged in the acquisition and exploration of gold projects in Namibia. Auryx is currently advancing the Otjikoto gold project, located 300 km north of Namibia’s capital city, Windhoek. By virtue of its location, the project benefits significantly from Namibia’s well established infrastructure with paved highways, a railway, power grids, and water grid all close by. Located in the western part of southern Africa, Namibia is lauded as one of the continent’s most politically and socially stable jurisdictions.
On Behalf of B2GOLD CORP.
“Clive T. Johnson”
President and Chief Executive Officer AURYX GOLD CORP.
Chief Executive Officer
For more information on B2Gold please visit its web site at www.b2gold.com or contact:
Vice President, Investor Relations
604-681-8371 Kerry Suffolk
Manager, Investor Relations
For more information on Auryx please visit its web site at www.auryxgold.com or contact:
Andisheh Beiki – Investor Relations
416-361-2213 or 647-968-1920
Chief Executive Officer