Discovery Silver acquires Porcupine Operations from Newmont for $425M

Newmont Corporation has announced the sale of its Porcupine operations near Timmins, Ontario, to Discovery Silver Corp. for $425 million, marking the final phase of Newmont’s strategic divestiture program. The transaction establishes Discovery Silver as a major player in the Timmins Camp, one of the world’s most prolific gold regions.

“Today’s announcement represents a significant milestone for Newmont as we conclude our non-core asset divestitures,” said Tom Palmer, Newmont’s President and CEO. “We are confident that Discovery’s leadership will continue to operate Porcupine responsibly and unlock its potential while we focus on our Tier 1 assets.”

Key Transaction Details

Under the agreement, Discovery will acquire Newmont’s interest in the Porcupine Complex for $425 million, comprised of:

• $200 million in cash upon closing.

• $75 million in Discovery shares issued at closing.

• $150 million in deferred payments, to be made in four annual installments of $37.5 million starting December 31, 2027.

Discovery has secured a $555 million financing package to fund the acquisition and ongoing operations, including $400 million from Franco-Nevada Corporation through royalty and debt agreements and $155 million from a bought deal public offering.

Discovery’s Vision for Porcupine

“This acquisition is a transformative step in building a highly profitable North American precious metals producer,” said Tony Makuch, CEO of Discovery Silver. “The Porcupine Complex complements our Cordero silver project in Mexico and positions Discovery as a diversified, multi-asset company with significant growth potential.”

The Porcupine Complex includes the Hoyle Pond, Pamour, and Dome mines, as well as the Borden underground mine near Chapleau, Ontario. With average annual production expected to exceed 285,000 ounces of gold over the next decade, Discovery plans to invest in improving operational efficiency, enhancing sustainability, and conducting extensive exploration across the 140,000-hectare land package.

Strategic and Community Benefits

Discovery’s leadership team, many of whom have deep roots in the Timmins area, is committed to supporting local stakeholders, including First Nations communities. The company plans significant investments in site restoration and mine closure to ensure long-term environmental and community benefits.

“This acquisition allows us to leverage our extensive experience in Timmins to optimize Porcupine’s operations and unlock its full potential,” added Makuch. “We are dedicated to responsible mining and creating long-term value for all stakeholders.”

Newmont’s Divestiture Program

The Porcupine sale concludes Newmont’s divestiture program, which has generated up to $4.3 billion from non-core asset sales. This includes proceeds from the sale of operations in Australia, Ghana, and North America, enabling Newmont to reduce debt and return capital to shareholders.

The transaction is expected to close in the first half of 2025, subject to regulatory approvals and customary conditions.

By Kevin Vincent, Senior Contributing Editor to Mining Life Online and Mining Life & Exploration News

Tags: Northern Ontario / Deals & Financial / Gold / All Articles