The union of Iamgold (IMG-T, IAG-N) and Orezone Resources (OZN-T, OZN-X) will go ahead.
Orezone shareholders gave a resounding confirmation of a friendly offer from Iamgold with 99.94% of the votes tabulated on Feb. 18th casting their approval. The votes cast represents 78.10% of Orezone’s outstanding shares.
The deal will give Orezone shareholders 0.08 common shares of Iamgold plus 0.125 of a share of the new exploration company, Orezone Gold Corporation, for each Orezone share held.
The new Orezone Gold will start trading the day after the current Orezone ceases to trade which will likely be on February 25th.
The deal secures for Iamgold the Essakane gold project in Burkina Faso. It instantly becomes Iamgold’s second flagship gold property in West Africa to couple with its 19% stake in the massive Tarkwa project in Ghana.
Tarkwa has 299 million tonnes grading 1.3 grams gold for 2.3 million oz. of proven and probable reserves attributable to Iamgold.
Essakane has 58 million tonnes grading 1.67 grams gold for 3.1 million oz. of proven and probable reserves.
Construction of the mine was begun by Orezone in September of last year, but as credit markets dried up the company’s ability to raise the $350 million needed to finish it came into doubt.
Iamgold has pockets deep enough to finish the mine, and expects it to be complete in 2010.
“Our strong balance sheet during the global credit meltdown allowed us to take advantage of a unique market opportunity, making the deal accretive on all key metrics,” Iamgold’s president and chief executive Joseph Conway said in a statement.
The project adds more than 30% to Iamgold’s reserves and gives it near-term production in excess of 300,000 ounces of gold per year.
As for the new company, Orezone Gold, it will retain Orezone’s management and exploration team. The new company will have three advanced gold projects in Burkina Faso including Bombore with 926,000 ounces of Measured and Indicated resources and 1.78 million of Inferred Resources.
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