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Iamgold gains full ownership of Nelligan with Vanstar buy

6th December 2023

By: Creamer Media Reporter

     

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Dual-listed Iamgold is consolidating its interest in the Nelligan deposit, in northern Quebec, announcing on Tuesday an agreement to acquire Vanstar Resources.

Vanstar is an exploration company with properties in northern Quebec at different stages of development. Its primary asset is the 25% interest in the Nelligan project, which is held under an earn-in option to the joint venture agreement with Iamgold.

“This transaction consolidates our interest in the highly prospective Nelligan deposit, while building our exploration portfolio within northern Quebec,” commented  Iamgold president and CEO Renaud Adams.

"Our exploration efforts at Nelligan to date, in partnership with Vanstar, have shown the potential for further resource expansion which we will continue to advance.”

The total consideration payable by Iamgold, based on the consideration value, is about C$45-million on a fully diluted in-the-money basis. The consideration value represents a 74% premium to the 20-day volume-weighted average price of the Vanstar shares on TSX-V on December 1.

"This transaction provides a meaningful premium to our shareholders and the opportunity to continue to benefit as part of an established gold producer with a meaningful growth pipeline including participation in the ramp-up of Côté Gold," said Vanstar president and CEO JC St-Amour.

While the transaction bolsters Iamgold’s Canadian exploration portfolio, the company’s priority remains the successful commissioning, ramp-up and growth of Côté, in Ontario.

“Côté is a project that is critical for the repositioning of this company, as once online, Iamgold will have a significantly higher production base and lower cost profile, providing a strong foundation of cashflow and growth opportunities in Canada,” said Adams.

On January 12,  Iamgold announced an updated mineral resource estimate for Nelligan of 72.2-million tonnes of indicated mineral resources averaging 0.85 g/t for 1.97-million ounces of gold, and 114.1-million tonnes of inferred mineral resources averaging 0.88 g/t gold for 3.24-million ounces of gold.

Edited by Creamer Media Reporter

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