Agnico Eagle sells Barsele stake to Goldsky for $20M

[Ben Graham]

Canada’s Agnico Eagle (TSX, NYSE: AEM) said on Wednesday it will sell its 55% interest in the Barsele project in northern Sweden, exiting direct ownership while retaining a royalty and a larger equity position in its partner Goldsky Resources (TSX-V: GSKR).

Agnico will receive $20 million in cash and 75.5 million shares of Goldsky Resources Corp. valued at C$2.64 each, making Goldsky the sole owner and operator of Barsele.

The transaction involves Agnico Sweden AB selling its stake in Gunnarn Mining AB to Goldsky and includes a 2% net smelter return royalty for Agnico Eagle. The deal is expected to close by June 30 this year, subject to TSX Venture Exchange and Goldsky shareholder approvals.

After closing, Agnico Eagle’s ownership in Goldsky will rise to about 32.5% of outstanding shares on a non-diluted basis, from roughly 4.1%. Its holdings will increase from 7.4 million shares to about 82.9 million.

Under an amended investor rights agreement, Agnico Eagle will have the right to participate in future equity financings to maintain its ownership up to 19.99% and may nominate one to three directors to Goldsky’s board, though it said it has no current plans to do so.

Agnico Eagle said the sale reflects ongoing portfolio optimization, noting that while exploration over the past decade expanded Barsele’s mineral resources, further work is needed to advance the project toward development.

The Barsele project is located in Västerbottens Län, about 600 km north of Stockholm. Agnico Eagle operates mines in Canada, Australia, Finland and Mexico.