Tmac Resources Inc. to Be Acquired BY Agnico Eagle
TMAC RESOURCES INC. TO BE ACQUIRED BY AGNICO EAGLE
Toronto (January 5, 2021) – Agnico Eagle Mines Limited (NYSE: AEM, TSX: AEM)
("Agnico Eagle") and TMAC Resources Inc. (TSX: TMR) ("TMAC") announced today
that they have entered into agreements pursuant to which Agnico Eagle has agreed to
acquire all of the outstanding common shares of TMAC (the "Transaction") at a price of
C$2.20 per share (the "Offer Price") in cash, which represents an increase of C$0.45 per
share as compared to the offer price of C$1.75 offered by Shandong under the original
Arrangement Agreement, as further described below.
The Transaction is being effected by way of assignment to Agnico Eagle of the
arrangement a greement dated May 8, 2020 (the "Arrangement Agreement ") among
TMAC, Shandong Gold Mining (HongKong) Co., Limited and its affiliate Streamers Gold
Mining Corporation Limited (collectively, "Shandong") and Shandong Gold Mining Co.,
Ltd. (together with Shandong, the "Shandong Parties") in accordance with an assignment,
assumption and novation agreement among the Shandong Parties, TMAC and Agnico
Eagle dated January 4, 2021 (the "Assignment Agreement") and the amendment of the
Arrangement Agreement under an amending agreement between Agnico Eagle and
TMAC dated January 4, 2021 (the "Amending Agreement "). The arrangement was
approved by 97.08% of the votes of TMAC shareholders that were represented at the
special meeting held on June 26, 2020; there will be no further shareholders' meeting in
connection with the Transaction.
The total equity value under the Transaction is approximately C$286.6 million. In
addition, in connection with the closing of the Transaction, Agnico Eagle will retire TMAC's
outstanding debt and deferred interest and fees. The Offer Price represents a premium
of approximately 26% to the offer price of C$1.75 per TMAC share that was to be paid by
Shandong and a premium of approximately 66% to TMAC 's 20 -day volume -weighted
average price as at January 4, 2021.
Resource Capital Funds ("RCF"), Newmont Corporation ("Newmont"), Shandong and all
directors and officers of TMAC, collectively holding approximately 62.3% of the current
outstanding TMAC common shares, have entered into agreements with Agnico Eagle that
include obligations to, among other matters, cooperate in seeking the Agnico Final Order
(as defined below) and not solicit competing transactions or take actions that would
interfere with the completion of the Transaction.
Sean Boyd, Agnico Eagle's Vice-Chairman and Chief Executive Officer, stated, "We are
very pleased to have the opportunity to bring our extensive northern operational and
community experience to the Hope Bay Mine and the Kitikmeot Region of Nunavut.
Together with the TMAC team and our Nunavut partners , we look forward to advancing
exploration and expansion initiatives to realize the full potential of the Mine and its large
unexplored land package."
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Jason Neal, TMAC's President and Chief Executive Officer , commented, "I am very
excited to welcome Agnico Eagle to Hope Bay. Our company spent almost the entirety
of 2020 under the uncertainty of a strategic review process and the Canadian government
review of the sale to Shandong, with an impending debt maturity, compounded by the
anxiety of the global pandemic. Our employees showed great focus that delivered
outstanding results. The Nunavut communities showed great patience. Sprott Lending
provided accommodation and support. The acquisition being completed by Agnico Eagle
is a great outcome for all stakeholders. Agnico Eagle is one of the strongest gold
producers internationally, a Canadian champion and has been operating in Nunavut for
more than a decade with a great track record with communities, employees and the
environment."
Newmont's President and Chief Executive Officer, Tom Palmer said, "The sale of TMAC
to Agnico Eagle is an excellent outcome for TMAC 's shareholders, employees and local
communities. Agnico Eagle's extensive experience in the Arctic, coupled with their clear
commitment to the highest environmental, social and governance practices make the m
uniquely qualified to lead and realize the fullest potential of the Hope Bay gold district."
Ross Bhappu, Head of Private Equity Funds for RCF said, "RCF would like to compliment
TMAC's current operational management team on the significant mining, milling and
safety achievements and establishing the foundation from which Agnico Eagle can
continue the team's outstanding track record on ESG matters as well as operating in the
Arctic."
Transaction Summary
The Transaction will be completed by way of a Plan of Arrangement under the Business
Corporations Act (Ontario). The Transaction is subject to approval under the Competition
Act (Canada) and to a n amendment of the final order issued on June 30, 2020 by the
Ontario Superior Court of Justice to approve the substitution of Agnico Eagle as
purchaser under the Plan of Arrangement (such amended final order, the "Agnico Final
Order"). TMAC intends to seek the Agni co Final Order at a hearing before the Ontario
Superior Court of Justice (Commercial List) to be held by Zoom on January 20, 2021 at
11:00 a.m. (Toronto time). TMAC will advise shareholders by way of a f urther press
release regarding details of the court process. The Transaction will also be subject to
other closing conditions customary in transactions of this nature.
Agnico Eagle and TMAC have agreed to use their commercially reasonable efforts to
consummate the Transaction on or before February 8, 2021.
The board of directors of TMAC, after consultation with its financial and legal advisors,
and on the unanimous recommendation of a special committee of independent directors
of TMAC (the "TMAC Special Committee"), has unanimously approved the Transaction.
In connection with approving the Transaction, Blair Franklin Capital Partners provided an
opinion to the TMAC Special Committee and the TMAC board of directors stating that,
based upon and subject to the assumptions, limitations and qualifications set forth therein,
the consideration offered to the TMAC shareholders pursuant to the Transaction is fair,
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from a financial point of view, to the TMAC shareholders, and each of BMO Capital
Markets and CIBC Capital Mark ets provided an opinion to the TMAC board of directors
stating that, based upon and subject to the assumptions, limitations and qualifications set
forth therein, the consideration offered to the TMAC shareholders pursuant to the
Transaction is fair, from a financial point of view, to the TMAC shareholders.
TMAC will file a material change report in respect of the Transaction in compliance with
Canadian securities laws as well as copies of the Assignment Agreement and Amending
Agreement, which will be available on TMAC's profile on SEDAR at www.sedar.com. A
copy of the Arrangement Agreement and certain other principal agreements relating to
the Arrangement Agreement can be found under TMAC 's profile on SEDAR at
www.sedar.com.
Agnico Eagle has engaged Trinity Advisors Corporation and First Asia Group Ltd. as its
financial advisor s and Davies Ward Phillips & Vineberg LLP as its legal advisor in
connection with the Transaction. TMAC has engaged BMO Capital Markets and CIBC
Capital Markets as its financial advisors and Cassels Brock & Blackwell LLP as its legal
advisor in connection with the Transaction. The TMAC Special Committee has engaged
Blair Franklin as its financial advisor and Stikeman Elliott LLP as its legal advisor.
About Agnico Eagle Mines Limited
Agnico Eagle is a senior Canadian gold mining company that has produced pre cious
metals since 1957. Its operating mines are located in Canada, Finland and Mexico, with
exploration and development activities in each of these countries as well as in the United
States, Sweden and Colombia. Agnico Eagle and its shareholders have full exposure to
gold prices due to its long -standing policy of no forward gold sales. Agnico Eagle has
declared a cash dividend every year since 1983.
About TMAC Resources Inc.
TMAC operates the Hope Bay property located in Nunavut, Canada. The property and
operations are remote but not isolated, serviced by both a port and airstrip. Hope Bay is
an 80 km by 20 km Archean greenstone belt that has been explored by BHP, Miramar,
Newmont and TMAC over a period spanning more than 30 years. TMAC began
producing gold in early 2017 from Doris, its first mine at Hope Bay, and processed gold
at the Doris processing plant which originally had nameplate capacity of 1,000 tpd and
expanded to 2,000 tpd midway through 2018. There is potential to grow TMAC's
established deposits considerably at depth, and then grow resources further through the
prioritized exploration of the more than 90 other identified regional targets. TMAC is now
permitted to produce from both Madrid and Boston.
Further Information
For further information regarding Agnico Eagle, contact Investor Relations at
[email protected] or call (416) 947-1212.
For further information regarding TMAC, contact Lisa Wilkinson, Vice President, Investor
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Relations and Strategic Development at [email protected] or call 647-
480-3110.
Forward-Looking Statements
The information in this news release has been prepared as at January 5, 2021. Certain
statements in this news release, referred to herein as "forward-looking statements ",
constitute "forward-looking statements" within the meaning of the United States Private
Securities Litigation Reform Act of 1995 and "forward-looking information " under the
provisions of Canadian provincial securities laws. These statements can be identified by
the use of words such as "expected", "may", "will" or similar terms.
Forward-looking statements in this news release include, but are not limited to:
statements relating to the outcome of the Transaction ; the ability of Agnico Eagle and
TMAC to complete the Transaction on the ter ms described herein, or at all; and receipt
of the Agnico Final Order and the necessary Competition Act (Canada) approvals.
Forward-looking statements are necessarily based upon a number of factors and
assumptions that, while considered reasonable by Agnico Eagle and TMAC as of the date
of such statements, are inherently subject to significant business, economic and
competitive uncertainties and contingencies. Many factors, known and unknown, could
cause actual results to be materially different from those express ed or implied by such
forward-looking statements. Readers are cautioned not to place undue reliance on these
forward-looking statements, which speak only as of the date made. Other than as
required by law, Agnico Eagle and TMAC do not intend, and do not assume any
obligation, to update these forward-looking statements.