Trek Mining, NewCastle Gold and Anfield Gold Provide Update on Business Combination to Create Equinox Gold
November 16 2017 - 6:30AM
Trek Mining Inc. (TSX-V:TREK) (“Trek Mining”), NewCastle Gold Ltd.
(TSX:NCA) (“NewCastle”) and Anfield Gold Corp. (TSX-V:ANF)
(“Anfield”) are pleased to announce an update on the proposed
transaction to combine their businesses to create Equinox Gold
Corp. (“Equinox Gold”), as previously announced on October 25, 2017
(the “Transaction”). Led by Ross Beaty as Chairman, Equinox Gold
will be a well-financed gold mining company with a near-term
strategy to become a multi-asset, low-cost gold producer.
A number of significant milestones have been
achieved since the Transaction was announced, further bolstering
Equinox Gold’s treasury and advancing the Aurizona Gold Mine
(“Aurizona”).
- Trek Mining received the final key permit required to construct
Aurizona and expand throughput to 8,000 tonnes per day to
achieve targeted average production of 136,000 ounces of gold per
year
- Anfield entered into an agreement to sell its Coringa Gold
Project for US$22 million
- Anfield entered into an agreement to sell a receivable due to
the company for US$13 million
- Joint information circular will be mailed to NewCastle and
Anfield shareholders on November 28, 2017
- Special meetings of NewCastle and Anfield shareholders
scheduled for December 19, 2017
- Transaction close anticipated on or about December 22,
2017
MONETIZATION OF ANFIELD ASSETS
Anfield has delivered on its stated objective of
monetizing its assets, and has entered into separate agreements to
sell its Coringa Gold Project in Brazil and to sell a receivable
due to the company. These assets were sold for an aggregate of
US$35 million (C$44.8 million), in addition to the C$11 million
already in Anfield’s treasury (as at September 30, 2017). Assuming
successful closing of both agreements, Anfield anticipates that
US$18 million (C$23.0 million) will be received before closing
of the Transaction, with an additional US$5 million
(C$6.4 million) to be received in Q1-2018 and the remainder to
be received before year-end 2019. The agreements are subject to
certain conditions, as outlined in the Anfield press releases dated
November 10 and November 14, 2017.
Upon completion of the Transaction and the
Anfield asset sales, Aurizona will be fully funded to production.
Equinox Gold will have pro forma cash and marketable securities of
approximately C$143 million (cash as at September 30, 2017 plus
aggregate proceeds from Anfield asset sales), will draw from a
US$85 million credit facility to fund Aurizona construction, and
can also access up to US$200 million for future project development
and acquisitions, providing significant capacity to develop the
Castle Mountain Gold Project in California and continue to grow the
company.
AURIZONA PERMIT
Trek Mining has received the final key permit
for Aurizona, allowing the company to complete the construction
activities required to commence production at the mine and expand
throughput to 8,000 tonnes per day, with the expectation of
producing on average 136,000 ounces of gold per year. Early works
construction is underway and the company is on track to pour gold
in late 2018.
NEXT STEPS TO CLOSE THE TRANSACTION
NewCastle and Anfield have jointly obtained an
interim order from the British Columbia Supreme Court for the
companies to hold special meetings of their shareholders to approve
the Transaction and other matters. The Board of Directors of both
NewCastle and Anfield are recommending approval of the Transaction
by their shareholders. The directors, senior officers and certain
significant shareholders of each company have entered into lock-up
agreements and agreed to vote in favour of the Transaction,
representing approximately 25.5% of the issued and outstanding
common shares of NewCastle and 27.2% of the issued and outstanding
common shares of Anfield, respectively.
The Transaction requires approval by (i)
two-thirds of the votes cast by NewCastle and Anfield shareholders
at their respective shareholder meetings, and (ii) if required, a
simple majority of the votes cast by NewCastle and Anfield
shareholders at their respective shareholder meetings, excluding
the votes held by certain persons as required by Multilateral
Instrument 61-101. There is no regulatory requirement for a meeting
of Trek Mining shareholders.
The special meetings of NewCastle and Anfield
are scheduled for December 19, 2017. A joint information circular
detailing the terms and conditions of the Transaction will be
mailed to the shareholders of both NewCastle and Anfield on
November 28, 2017.
The Transaction, if approved by the shareholders
of NewCastle and Anfield, is expected to close on or about December
22, 2017. Upon closing, Trek Mining will acquire all outstanding
shares of NewCastle and Anfield at the previously announced
exchange ratios of 0.873 Trek Mining shares for each NewCastle
share and 0.407 Trek Mining shares for each Anfield share. Each
NewCastle and Anfield warrant and option will become exercisable
for Trek Mining common shares, as adjusted in accordance with the
applicable exchange ratio. Trek Mining will then be re-named
Equinox Gold Corp. and its shares will commence trading on the TSX
Venture Exchange under the new symbol “EQX”.
TREK MINING CONTACTS
Christian Milau, CEORhylin Bailie, Vice
President Investor RelationsTel: +1 604-558-0560Email:
ir@trekmining.com
NEWCASTLE CONTACTS
Marc Leduc, Interim CEOGillian Roy, Director
Investor Relations & Corporate CommunicationsTel: +1
416-366-5678Email: info@newcastlegold.ca
ANFIELD CONTACT
Marshall Koval, Chairman & CEOTel: +1
604-646-1899Email: info@anfieldgold.com
CAUTIONARY NOTES AND
FORWARD-LOOKING STATEMENTS
Neither the TSX Venture Exchange nor its
Regulation Services Provider (as such term is defined in the
policies of the TSX Venture Exchange) accepts responsibility for
the adequacy or accuracy of this release.
This document contains certain forward-looking
information and forward-looking statements within the meaning of
applicable securities legislation (collectively “forward-looking
statements”). The use of the words “proposed”, “strategy”, “will
be”, “will”, “objective”, “subject to”, “on track”, “scheduled”,
“expected” and similar expressions are intended to identify
forward-looking statements. Forward-looking statements contained in
this press release include, but are not limited to, statements
regarding the proposed Transaction, the proposed name change of the
combined company, satisfaction of certain approvals (including
TSX-V and shareholder approvals) required to complete the
Transaction, the anticipated restart of production at Aurizona,
Anfield’s ability to complete the proposed asset sales, and the
cash that will come to Equinox Gold following monetization of
Anfield’s assets. Although Trek Mining, NewCastle and Anfield (the
“Companies”) believe that the expectations reflected in such
forward-looking statements and/or information are reasonable, undue
reliance should not be placed on forward-looking statements since
the Companies can give no assurance that such expectations will
prove to be correct. These statements involve known and unknown
risks, uncertainties and other factors that may cause actual
results or events to differ materially from those anticipated in
such forward-looking statements, including the risks, uncertainties
and other factors identified in the Companies’ periodic filings
with Canadian securities regulators, and assumptions made with
regard to: the Companies’ ability to complete the proposed
Transaction; the Companies’ ability to secure the necessary
shareholder, legal and regulatory approvals required to complete
the Transaction; the anticipated Board of Directors decision to
approve construction of Aurizona; the estimated costs associated
with construction of Aurizona; the ability to restart production at
Aurizona; the timing of the anticipated restart of production; the
ability to achieve the gold production rates and costs outlined in
the Aurizona feasibility study; the anticipated development of the
Castle Mountain Gold Project; Equinox Gold’s anticipated financial
position following completion of the Transaction; and the
Companies’ ability to achieve the synergies expected as a result of
the Transaction. Furthermore, the forward-looking statements
contained in this news release are made as at the date of this news
release and the Companies do not undertake any obligations to
publicly update and/or revise any of the included forward-looking
statements, whether as a result of additional information, future
events and/or otherwise, except as may be required by applicable
securities laws.