TORONTO (miningweekly.com) – The US’s largest primary silver producer Coeur Mining has agreed to buy Goldcorp’s Wharf gold mine, a producing gold mine located near Lead, South Dakota, for $105-million in cash.
Coeur said on Monday that the mine was expected to produce 85 000 oz to 90 000 oz of gold this year at an all-in sustaining cost of $800/oz to $875/oz of gold.
The acquisition was expected to lift the company’s 2015 earnings before interest, taxes, depreciation and amortisation by more than 30% and boost free cash flow while reducing Coeur’s consolidated unit costs.
The thirty-year-old Wharf openpit operation would lift Coeur’s total gold reserves by 24%.
"This divestiture of Wharf will unlock additional value for Goldcorp shareholders and demonstrates our commitment to focusing on the core assets within our portfolio," president and CEO Chuck Jeannes said in Monday's statement.
Coeur president and CEO Mitchell Krebs noted that he believed the transaction would generate an attractive rate of return and was immediately accretive to cash flow and net asset value.
“We are excited to welcome our new team members at Wharf as we look to pursue identified opportunities to optimise the operation, add incremental value and extend the mine life.”
Coeur’s stock rose 4.45% on the NYSE on Monday to $6.10 apiece.