TSX- and Nasdaq-listed SSR Mining has reached a definitive agreement to acquire all of the issued and outstanding shares of TSX-listed Roxmore Resources pursuant to a court-approved plan of arrangement.

SSR Mining operates the Marigold Complex in Nevada, with Roxmore's Converse gold project being located just six kilometres west of the operation.

Developing Converse as a contiguous asset to Marigold is expected to create opportunities for an expanded production profile in Nevada and deliver more than $200-million in life-of-mine synergies compared to the development of the project on a stand-alone basis.

In terms of the transaction, Roxmore shareholders will receive C$6.75 per Roxmore common share in cash and common shares of a newly created gold exploration company that will hold interests in Roxmore's Rattlesnake Hills project, Shabu River project and Newton property.

The spin-out company will be funded with $10-million in cash and will be owned 85.01% by Roxmore shareholders and 14.99% by SSR Mining. The new company will be led by key members of Roxmore's current management team.

Excluding the value of the spin-out company, the cash component of SSR's takeover of Roxmore represents a 27% premium to Roxmore's closing share price on TSX on October 9 and a 47% premium to the 20-day volume-weighted average price.

The equity value of the transaction, excluding the spin-out company, is estimated to be $464-million while the enterprise value is $392-million.

SSR Mining plans to fund the cash component of the consideration from its current balance sheet.

RATIONALE

Roxmore's converse project adds a multimillion-ounce heap-leachable resource to the Marigold Complex, providing a clear pathway to future production growth and district-scale development - given the projects' proximity.

Roxmore's 2026 mineral resource estimate included 103-million tonnes of indicated resources at a grade of 0.65 g/t, for 2.2-million ounces of contained gold.

SSR Mining envisions developing Converse as a contiguous asset to the Marigold Complex using the same pit shell assumptions used in the 2026 Marigold Complex technical report summary.

Additional resource growth and conversion potential exists through future resource development and exploration drilling.

Under SSR Mining’s proposed development approach, Converse has the potential to add about 150 oz 000 to 170 000 oz of gold production a year over an estimated ten-year mine life with initial production targeted for 2033.

Initial capital for construction is estimated at between $800-million and $900-million with no material capital spend expected until the early 2030s.

Combined with Marigold and Cripple Creek & Victor - SSR Mining's active gold mine in Colorado - the company has the potential to produce between 350 000 oz and 400 000 oz of gold a year from sites in the US through the 2030s. 

SSR Mining estimates the combination of the projects can realise synergies of at least $200-million by eliminating duplicate site and corporate administrative costs, as well as through procurement and supply chain efficiencies.

SSR Mining says its near-term focus at Converse will be on environmental baseline studies, permitting, flowsheet optimisation and technical derisking activities.

MARIGOLD UPDATE

In a technical report summary on the Marigold Complex released on October 13, SSR Mining highlights a 20-year life-of-mine (LoM) plan based on an expanded 4.6-million-ounce mineral reserve.

The complex has an after-tax net present value of $3.3-billion as consensus and spot prices, respectively, with expected average yearly production of 231 000 oz from 2027 to 2031.

Marigold can produce 3.3-million ounces over its lifetime at an all-in sustaining cost of $2 062/oz. The technical report summary did not take into account the additional Converse ounces or values, rather, it is a standalone LoM plan for the existing Marigold Complex, which increased its mineral reserves by 43% to 4.6-million ounces.

Converse is being treated as a future growth and expansion project, or contiguous asset, targeting first gold from 2033, rather than an integrated component of the Marigold technical report summary.