Minera Alamos Announces Acquisition of Sabre Gold

Core Viewpoint - Minera Alamos Inc. has announced the acquisition of Sabre Gold Mines Corp., enhancing its position as a growth-oriented gold producer by adding the Copperstone project, which is expected to provide significant near-term production potential [2][3]. Transaction Highlights - The acquisition creates a diversified North American gold producer platform, adding 150,000 ounces of annual gold production potential from the Copperstone project in Arizona, alongside existing operations in Mexico [3][6]. - The Copperstone mine, previously producing 514,000 ounces of gold from 1987 to 1993, has significant additional resources and is at an advanced stage of permitting for a near-term restart [3][17]. - The transaction will eliminate approximately $9.4 million of existing debt at a 15% discount to face value, supported by Sabre's creditors [3][10]. Benefits to Minera Alamos Shareholders - The acquisition of the low capital intensity Copperstone project complements Minera Alamos' existing late-stage development assets and the Santana gold mine [5][10]. - The current Preliminary Economic Assessment (PEA) for Copperstone envisions a low capex start-up capable of producing over 40,000 ounces of gold annually at an All-In Sustaining Cost (AISC) of $1,290 per ounce [6][22]. - The acquisition cost is approximately $43 per ounce based on 300,000 ounces of Measured and Indicated resources, leading to a 35% increase in Minera Alamos' total gold resource inventory to nearly 1.9 million ounces [7][10]. Benefits to Sabre Gold Shareholders - Sabre Gold shareholders will receive a significant premium and maintain exposure to the Copperstone Mine through ownership in the combined company, while also gaining access to Minera Alamos' producing assets [10][12]. - The merger diversifies Sabre's exposure from a single asset to a portfolio with multiple production and late-stage projects, enhancing trading liquidity and capital market presence [10][12]. Transaction Details - The transaction involves the exchange of all Sabre Gold shares for 0.693 Minera Alamos shares, resulting in the issuance of approximately 76.5 million Minera Alamos shares [11][12]. - Upon completion, existing Minera Alamos and Sabre Gold shareholders will own approximately 86% and 14% of the combined company, respectively [12][30]. - The transaction is subject to customary conditions, including shareholder and court approvals, with a special meeting of Sabre Gold shareholders expected in January 2025 [13][14]. Copperstone Project Overview - The Copperstone project covers approximately 3,700 hectares in Arizona and has a history of production with significant existing infrastructure [16][17]. - The 2023 PEA outlines a revised start-up plan for the Copperstone project, including resource estimates and alternative mining methods [18][22]. - The project benefits from existing site infrastructure, which will reduce upfront construction costs and initial capital per payable gold ounce [19][20].