Argonaut Gold Inc. ("Argonaut" or "Argonaut Gold") (TSX: AR) and Alio Gold Inc. ("Alio" or "Alio Gold") (TSX, NYSE-A: ALO) have entered into a definitive agreement for an at-market merger whereby Argonaut will acquire all of the issued and outstanding shares of Alio. Under the terms of the Arrangement Agreement, all of the Alio issued and outstanding common shares will be exchanged on the basis of 0.67 of an Argonaut common share per each Alio common share (the "Exchange Ratio").
The Exchange Ratio has been agreed based on the volume-weighted average prices of Argonaut and Alio common shares over the 20 trading days ended on March 27, 2020.Upon completion of the Transaction, existing Argonaut and Alio shareholders will own approximately 76% and 24% of the pro forma company, respectively, on a fully-diluted, in-the-money basis.
Pete Dougherty, President & CEO of Argonaut stated: "This is a transaction which makes sense for both sets of shareholders.Combining complementary assets into one larger, more relevant company generates significant synergies.With a solid production base of over 235,000 gold equivalent ounces expected this year, a strong balance sheet and strong cash flow generation at current gold prices, we will be well positioned to evaluate and execute on growth opportunities from within the combined company's development asset portfolio."
About Argonaut Gold
Argonaut Gold is a Canadian gold company engaged in exploration, mine development and production.Its primary assets are the El Castillo mine and San Agustin mine, which together form the El Castillo Complex in Durango, Mexico and the La Colorada mine in Sonora, Mexico.Advanced exploration projects include the Cerro del Gallo project in Guanajuato, Mexico and the Magino project in Ontario, Canada.The Company continues to hold the San Antonio advanced exploration project in Baja California Sur, Mexico and several exploration stage projects, all of which are located in North America.
About Alio Gold
Alio Gold is a gold mining company. We are focused on the safe and profitable production of gold from our cornerstone asset, the 100% owned Florida Canyon Mine in Nevada, USA. The Company also owns the development stage Ana Paula Project in Guerrero, Mexico.
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