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Canadian Press – Osisko Mining Corp. signed an all-stock deal Monday valued at $550-million to buy Queenston Mining Inc. and its flagship Upper Beaver project in Ontario’s Kirkland Lake region.
Osisko president and chief executive Sean Roosen said work on the Upper Beaver project is coming to a critical stage in its development. “We feel this is the perfect time for us to bring our mine permitting and development teams into the project to back the plan and to make Upper Beaver a successful mine,” Mr. Roosen said on a call with analysts.
“We also have the ability to fund Upper Beaver development from internal cash flow so we don’t anticipate any further dilution as we evolve these projects.”
Queenston also owns several other gold properties in the Kirkland Lake gold camp area as well as interests in projects in Quebec, Manitoba and elsewhere in Ontario.
Queenston president and CEO Charles Page said the Upper Beaver project has the potential for four million ounces of gold. “Osisko’s proven development team can certainly maximize the potential of the Upper Beaver project,” he said.
Osisko’s main asset is the Canadian Malartic gold mine, which began commercial production in May 2011, in Quebec’s Abitibi mining region.
In addition to Canadian Malartic, Osisko is also developing the Hammond Reef project near Atikokan, Ont.
Mr. Page said Queenston did not conduct a formal process to look for a buyer, but Osisko offered a compelling opportunity.
“[Osisko] was a company of choice for us,” he said. “With their mine-building team and the success they’ve had with Malartic and their commitment to the Abitibi area, it seemed like a natural for us.”
For the rest of this article, please go to the National Post website: http://business.financialpost.com/2012/11/12/osisko-buying-queenston-mining-for-550m-in-stock/