A merger is in the works between Battle Mountain Gold (NYSE) and Crown Resources (NASDAQ).
The deal could result in Crown becoming part of Battle Mountain after an exchange of shares. For every one Crown share, shareholders would receive 0.4375 shares of Battle Mountain. The value of the Crown shares has been set at US$5.25 per share, which represents a 40% premium over the current price. Crown has 13.2 million outstanding shares.
Battle Mountain’s proposal, which expires in 15 days, comes at the recent inquiry by Crown into a possible merger. However, a release from Crown calls the move unexpected. The proposed merger will next go to Crown’s board of directors for review.
The two companies are partners in the Crown Jewel gold project in northeastern Washington state, with Battle Mountain owning 54%.
The move increases Battle Mountain’s contained gold reserves by 9% to 8.8 million oz. with 715,000 oz. coming from Crown’s share of the Crown Jewel deposit reserves.
Battle Mountain is paying all of the capital costs of developing the Crown Jewel property.
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