Endeavour mulls two more acquisitions as it buys Avion

8th August 2012 By: Esmarie Iannucci - Creamer Media Senior Deputy Editor: Australasia

KALGOORLIE (miningweekly.com) – Canada-based gold miner Endeavour Mining has two more possible acquisition targets in its sights, executive director and COO Mark Connelly said on Wednesday.

Connelly’s comments followed on Endeavour’s announcement that it had acquired fellow-listed Avion Gold for C$389-million.

“We have two other targets that we have been looking at…Canada-listed targets,” Connelly told journalists on the sidelines of the Diggers and Dealers conference in Kalgoorlie, Australia.

He noted that the company was focused on TSX-listed targets since transaction time was shorter compared with deals between ASX-listed companies.

“The second reason [we are focusing on TSX-listed companies] is that we have stated publicly that we want to move towards production ounces. We are not interested in early stage exploration, or companies on the ASX that are quoting resources and have long capital programmes of expenditure. We do not want to go down that path,” Connelly said.

“We like production. You get paid for reserve ounces, not resource ounces.”

The potential takeover targets are likely to have gold operations in West Africa with million-ounce reserve potential, which Endeavour would work to either improve upon or bring into production.

“If you run the ruler over operational assets in West Africa, you will see the ones we are focused on,” Connelly said.

Under the Avion acquisition, Endeavour would offer 0.365 of its own shares for each Avion share, valuing Avion at C$0.88 a share. The acquisition would immediately increase Endeavour’s gold production by some 50% to between 282 000 oz and 304 000 oz for 2012.

Connelly said that Endeavour was aiming to produce between 450 000 oz and 500 000 oz by the end of 2013, with its Agbaou project, in Cote d’Ivoire, expected to add some 100 000 oz/y by 2014.