McEwen to acquire Golden Lake Exploration, consolidating Gold Bar complex

[Ben Graham]

McEwen Inc. (NYSE/TSX:MUX) and Golden Lake Exploration (CSE:GLM) announced that they have entered into a Definitive Agreement whereby McEwen would acquire all of the issued and outstanding shares of Golden Lake by way of plan of arrangement.  

If the Proposed Transaction is completed, Golden Lake would become a wholly-owned subsidiary of McEwen. 

Golden Lake’s principal asset is its 100%-owned Jewel Ridge and Jewel Ridge West projects located adjacent to McEwen’s Windfall and Lookout Mountain discoveries, part of the Gold Bar Mine Complex, in the Eureka Mining District of Nevada. 

Historical drill highlights from Jewel Ridge project include 2.20 gpt gold over 28.96 meters, 1.24 gpt gold over 56.39 meters, 2.37 gpt gold over 67.57 meters. These holes are located north of McEwen’s Windfall deposit, where a recent drill hole returned 5.55 gpt gold over 44.2 meters.  

Incorporating Golden Lake’s projects into the Gold Bar Mine Complex will help continue the mine’s transformation into a long-life operation by investing in exploration and leveraging the current McEwen infrastructure, the company said in a news release.  

Under the terms of the deal, each Golden Lake common share would entitle its holder to receive 0.003876 McEwen common shares as is equal to $0.12 divided by the volume-weighted average trading price of the McEwen Shares on the Toronto Stock Exchange. 

By market close in Toronto, McEwen’s stock was down 5.7%. The company has a $1.64 billion market capitalization.  Golden Lake’s stock soared 66.7% on the news, bringing the junior’s market capitalization to C$11.6 million ($8.6m)