Eldorado Gold grabs stake in Probe Metals for US$18.9 million

Eldorado Gold (TSX:ELD; NYSE:EGO) has bought an 11.5% stake in Quebec-focused explorer Probe Metals (TSXV: PRB; US-OTC: PROFB) in a deal worth about $23.7 million (US$18.9 million).

The acquisition of 15.04 million common shares of Probe at $1.575 each follows the friendly takeover earlier this year of QMX Gold, another junior with assets in Quebec’s resource-rich Abitibi Greenstone Belt.

The buyout increased Eldorado’s footprint and landholdings in the area by approximately 550%.

Probe Metals owns several gold properties relatively close to Eldorado’s Lamaque gold mine, including the Val-d’Or East project.

Depending on market conditions, the company may raise or decrease its stake in Probe, it said.

The Vancouver-based miner is in the midst of building a US$24-million tunnel at Lamaque, its only Canadian operation, which began production in 2019. The project, which will allow the company to grow production and reduce energy use, is expected to be finished in the first half of 2022.

Outside Canada, Eldorado has mining, development and exploration operations in Greece, Turkey, Romania and Brazil, but has increased its focus on Canada in recent years.