TSX-listed Semafo said on Monday that it had entered into a definitive combination agreement pursuant to which it would acquire all the issues and outstanding common shares of TSX-V-listed Savary.
The Canadian companies previously said that they contemplated a transaction, in terms of which Savary shareholders will receive 0.0336 of a Semafo share for every share held. The exchange ratio implies a consideration of C$0.10 for every Savary share.
Savary shareholders will vote on the amalgamation at a special meeting with closing expected by the end of April.
The combination of the companies will consolidate Semafo and Savary’s projects in the Hounde Greenstone belt, in Burkina Faso.
Savary’s Karankasso hosts inferred resources of 12.3-milion tonnes at 2.03 g/t gold for 805 000 oz and Semafo’s Bantou has an inferred resource of 2.1-million tonnes grading 5.35 g/t for 361 000 oz.
Ore from the entire consolidated land package could be trucked to a central plant, with a current tentative plant location in the north-west of Semafo’s property.
The 2019 consolidated exploration will focus on accelerated resource growth on a consolidated basis, to be announced post-closing.
“Our acquisition of the Karankasso property reflects our core strategy of creating long-term value through developing and operating high-quality assets,” commented Semafo president and CEO Benoit Desormeaux in a statement on Monday.