Alamos Gold to acquire Quebec-focused junior Orford Mining in all-share deal

Alamos Gold (TSX: AGI; NYSE: AGI) announced on Monday that it will acquire Quebec-focused junior Orford Mining (TSXV: ORM) in an all-share transaction valuing the company at $24 million or 10¢ per share.

Alamos already owns 27.5% of the company’s shares. If the acquisition is approved by Orford shareholders at a meeting scheduled for March, they will receive 0.005588 of an Alamos share for each Orford share held. 

The offer represents a 114% premium to Orford’s closing price on Jan. 12.

The deal includes the Qiqavik gold project,  is a camp scale property covering 438 sq. km in the Cape Smith Belt in Nunavik, Que.

Qiqavik covers the 40-km-long Qiqavik Break, a major crustal-scale structure controlling gold mineralization on the belt. Early-stage exploration completed to date indicates that high-grade gold occurrences are controlled by structural splays off the Qiqavik Break, which extends along strike over the 40 km length of the project.

“Our acquisition of Orford is consistent with our strategy of building out a pipeline of high-quality, long-term projects, in good jurisdictions, to complement our near-term organic growth projects in Canada,” said John A. McCluskey, president and CEO of Alamos, in a release. “Qiqavik fits that strategy perfectly as an attractive early-stage gold project, located in one of top mining jurisdictions in the world. We see excellent long-term potential within the underexplored Qiqavik district and look forward to building off Orford’s success with a larger and sustained exploration program.” 

Orford began exploration on the project in 2016, and since that time has identified over 40 highly prospective targets across the previously underexplored property through mapping, prospecting, till sampling, geophysics, and limited drilling.

These targets include several high-grade boulder and gold grain-in-till trends, as well as outcrop gold showings across the property, according to Orford.

“Orford’s properties have shown strong exploration promise, in particular the company’s Qiqavik gold project in Nunavik which has widespread, high grade gold surface samples pointing to the camp scale gold potential of the property,” said Orford president and CEO David Christie. “We are confident that Alamos has the skill set and balance sheet to advance the Orford projects through the next stages of exploration and development.”

Alamos will also be acquiring interests in several exploration stage critical mineral and gold projects in Quebec, including West Raglan, the Joutel properties, and Nunavik lithium.

Alamos operates two mines in Ontario (Young-Davidson and Island) and one in Mexico (Mulatos), as well as development projects in Manitoba, Turkey and Oregon.

It has a market capitalization of $6.9 billion.