PERTH (miningweekly.com) – Dual-listed OceanaGold Corporation has launched a takeover of TSX-listed Pacific Rim Mining, to gain hold of the El Dorado gold project, in El Salvador.

OceanaGold plans to acquire all the common shares of Pacific Rim by trading 0.04006 of a share for each Pacific Rim share held, resulting in Oceana issuing some 6.76-million new shares to Pacific Rim shareholders.

The offer valued Pacific Rim shares at around C$0.06 each, representing a 50% premium over the 20-day volume-weighted average price of the company’s shares on the TSX, and a 73% premium to the closing price on October 7.

“We believe this transaction will provide OceanaGold shareholders with potential exposure to a high-grade gold/silver resource located in a very prospective region,” said OceanaGold MD and CEO Mick Wilkes.

“The project has the potential to be an economic engine for El Salvador, much like our recently commissioned world-class Didipio mine has been for northern Luzon in the Philippines.”

El Dorado currently has a measured and indicated resource of 1.43-million ounces of gold equivalent, grading 10.4 g/t and an inferred resource of 282 400 oz gold equivalent, grading 10.47 g/t.

Wilkes said that the acquisition of Pacific Rim also aligned well with OceanaGold’s strategy to create value through investment in high-quality, low-cost assets and using the company’s experience in building and operating gold mines in an environmentally and socially sustainable manner.

For Pacific Rim, the transaction meant that shareholders would have an opportunity to participate in a leading gold producer, and would allow shareholders continued exposure to the development of the El Dorado project, said Pacific Rim chairperson Catherine McLeod-Seltzer.

“We are very pleased to have negotiated a transaction with OceanaGOld that we believe reduces risk for our shareholders, while providing them with continued participation in the high-grade El Dorado gold project, and the upside that comes with OceanaGold’s existing operations and forward trajectory.”

The Pacific Rim board has unanimously approved the offer, and urged shareholders to do the same.

The transaction was still subject to a number of conditions, including a majority shareholder approval, as well as regulatory and exchange approvals.