Newly formed Havilah Mining, which was created following the spinout of Klondex Mines’ Canadian assets, will list on the TSX-V this week, US-based precious metals producer Hecla Mining said on Monday, announcing the completion of its Klondex acquisition.
Havilah will own the True North mining complex, near the town of Bissett, in Manitoba. True North is an underground mining operation consisting of several underground narrow-vein gold deposits, with a 2 500 t/d mill.
The listing of Havilah will occur on July 25 and Hecla has subscribed for 3.54-million common shares on a private placement basis for gross proceeds of C$9.24-million, giving it a 13.46% interest in the new entity. Hecla stated that the shareholding was acquired for investment purposes only.
Hecla acquired the outstanding common shares of Klondex for about $153-million and 75-million shares of Hecla common stock, extinguishing all rights to acquire Klondex common shares. Klondex shareholders who opted for a scrip transaction will receive 0.6272 of a Hecla share in exchange for their Klondex shares and those who opted for a combination of cash and share will receive $0.8411 in cash and 0.4136 of a Hecla share. Shareholders who elected to receive a cash consideration were subject to proration and will receive $0.8867 in cash and 0.4020 of a Hecla share.
In addition, Klondex shareholders will also receive 0.125 of a common share of Havilah.
The completion of the Klondex acquisition has added three new high-grade mines in Nevada to Hecla’s existing portfolio of operating mines in Alaska, Idaho and Mexico. President and CEO Phillips S Baker said in a statement that Hecla would immediately benefit from production and cash flow from the three newly acquired Nevada mines and that the group believed that there was significant opportunity for improvement in the mines’ productivity and consistency.
The three mines are Fire Creek, Midas and Hollister.
“We welcome the former Klondex shareholders and employees to Hecla, as we continue to grow into the largest and strongest company in its long history,” Baker added.