|Kirkland Lake Gold - KLG.t owns the five former high grade mines that produced 22 million ounces of gold at an average grade of 15.1 grams per tonne. The future of the Kirkland Lake camp brightened significantly some 6 years ago when there was a new high grade geologic discovery called the South Mine Complex discovered on its ground.|
On September 29, 2016 the company released NEWS
Kirkland Lake Gold Inc. ("Kirkland Lake Gold") (TSX:KLG) and Newmarket Gold Inc. ("Newmarket") (TSX:NMI) are pleased to announce that they have entered into a definitive agreement (the "Arrangement Agreement") to merge the two companies, creating an exciting new mid-tier gold company (the "Transaction"). The combined company will have a market capitalization of approximately C$2.4 billion and produce over 500 koz of gold annually. Existing Kirkland Lake Gold and Newmarket shareholders will own approximately 57% and 43% of the combined company, respectively, on a fully-diluted in-the-money basis.
The combination of Macassa and Fosterville will form the production backbone of a new mid-tier, high quality gold producer with low cost production and superior free cash flow generation. Kirkland Lake Gold operates its flagship Macassa Mine Complex in the historic Kirkland Lake gold camp, as well as the Holt, Holloway and Taylor gold mines (the "Holt Mine Complex") situated along the Porcupine-Destor Fault Zone, all located in northeastern Ontario. With the addition of Newmarket's Fosterville Gold Mine ("Fosterville") located in the state of Victoria, Australia and its other gold producing Cosmo and Stawell mines, the targeted gold production of the combined company will effectively be over 500 koz for the full year ended 2016. In addition, the combined company will have comprehensive technical capabilities to exploit its pipeline of development and exploration opportunities across a broad portfolio in both Tier-1 jurisdictions. This growth strategy will be supported by a strong balance sheet with a combined cash balance of over C$275 million along with superior free cash flow generation that amounted to C$92 million, on a combined basis, in the first half of 2016.
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