China Confidential
Foreign News and Analysis Since April 2005
Saturday, October 02, 2010
Swiss Suicide and Economic Espionage
Researcher Says China Becoming UFO Capital
Dinosaurs Were Even Taller Than Thought
Friday, October 01, 2010
Rising China Reaching Out to Debt-Stricken Greece
China and Turkey Closer Than You Think
India Auto Sales Accelerate
Asian Stocks Rise for Fifth Week
Japan PM Urges China to Act Responsibly
Is Ri Yong Ho North Korea's Big Winner?
Angola Battling Polio
27 NATO FUEL TANKERS TORCHED IN PAKISTAN
Oil Near Seven-Week High
Economic Optimism Fueling Crude Gains
NOTE: Interestingly, gold keeps on coming--like a freight train. Bullion is the new alternative currency, decoupled from traditional brakes. The markets seem capable of buying equities and oil ... and gold ... at the same time.
Big News Day for Gold: Canada's Gammon Gold Buying America's Capital Gold as Bullion Surges
Gold returned to a record high on Friday, surpassing $1,317 an ounce as the dollar declined and investors bought bullion as an alternative to currencies.
In related news, Gammon Gold Inc. ("Gammon Gold") (NYSE: GRS, TSX: GAM) and Capital Gold Corporation ("Capital Gold") (TSX and NYSE AMEX: CGC) announced that the two companies have entered into a definitive merger agreement pursuant to which Gammon Gold will offer to acquire all of the issued and outstanding common shares of Capital Gold in a cash and share transaction.
The total consideration for the purchase of 100% of the fully diluted in-the-money shares of Capital Gold is approximately US$288 million or US$4.57 per Capital Gold share based on Gammon Gold's closing price on September 24, 2010 on the NYSE.
The acquisition has the unanimous support of both companies' Boards of Directors and Officers and strengthens Gammon's position as a leading Mexico focused, growing gold producer.
Under the terms of the acquisition, each common share of Capital Gold will be exchanged for 0.5209 common shares of Gammon Gold and a cash payment in the amount of US$0.79 per share. Based on the September 24, 2010 closing price of Capital Gold's shares on the NYSE AMEX, the acquisition price represents a 20% premium to the close on September 24th and a 30% premium to the 20-day volume weighted average price on the NYSE AMEX ending on that date.
Both Companies Focused on Mexico
Capital Gold owns and operates the El Chanate gold mine located in Sonora, Mexico as well as the Orion development project in Nayarit, Mexico.
Gammon Gold Inc. is a mid-tier gold and silver producer with properties in Mexico. Gammon's flagship Ocampo Property in Chihuahua State achieved commercial production in January 2007. Gammon also owns the suspended El Cubo mine in Guanajuato State and has the promising Guadalupe y Calvo development property in Chihuahua State.
Gammon recently completed option purchase agreements to acquire the Mezquite Project in Zacatecas State, Mexico and the Venus project located north of the Ocampo mine. Gammon also recently signed a definitive agreement to acquire the Los Jaros Project in Chihuahua State. Since 2008, the company has increased its Mexican land position by over 59% and has made strategic investments in Golden Queen Mining Co. Ltd. and Corex Gold Corporation.
Gammon's Executive Office is located in Toronto, Ontario.
Posts
