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TMAC to be acquired by Agnico Eagle

Jan 5, 2021

By Stephane Villeneuve: Mining Life Online

Agnico Eagle Mines Limited and TMAC Resources Inc. recently announced they have entered into an agreement in which Agnico Eagle agrees to acquire all the outstanding common shares of TMAC at $2.20 per share. The announcement comes only weeks after the Federal Government Blocked the sale of TMAC to Shangdong Gold Mining, a china-based gold producer.

The New arrangement with Agnico Eagle increases the offer from C$1.75 to C$2.20 per share over the Shangdong deal and brings the total equity value under the transaction to approximately C$268.6 million. As part of the transaction, Agnico Eagle will retire TMAC’s outstanding debt and deferred interest and fees.

Resource Capital Funds ("RCF"), Newmont Corporation ("Newmont"), Shandong and all directors and officers of TMAC, collectively holding approximately 62.3% of the current outstanding TMAC common shares, have entered into agreements with Agnico Eagle that include obligations to, among other matters, cooperate in seeking the Agnico Final Order (as defined below) and not solicit competing transactions or take actions that would interfere with the completion of the Transaction.

A copy of the arrangement can be accessed at TMAC's profile on SEDAR at www.sedar.com. TMAC Resources operates the Hope Bay Property located in Nunavut.

Sean Boyd, Agnico Eagle's Vice-Chairman and Chief Executive Officer, stated, "We are very pleased to have the opportunity to bring our extensive northern operational and community experience to the Hope Bay Mine and the Kitikmeot Region of Nunavut.  Together with the TMAC team and our Nunavut partners, we look forward to advancing exploration and expansion initiatives to realize the full potential of the Mine and its large unexplored land package."

Jason Neal, TMAC's President, and Chief Executive Officer commented, "I am very excited to welcome Agnico Eagle to Hope Bay.  Our company spent almost the entirety of 2020 under the uncertainty of a strategic review process and the Canadian government review of the sale to Shandong, with an impending debt maturity, compounded by the anxiety of the global pandemic.  Our employees showed great focus that delivered outstanding results.  The Nunavut communities showed great patience.  Sprott Lending provided accommodation and support. 

The acquisition being completed by Agnico Eagle is a great outcome for all stakeholders.  Agnico Eagle is one of the strongest gold producers internationally, a Canadian champion, and has been operating in Nunavut for more than a decade with a great track record with communities, employees, and the environment.”

Newmont's President and Chief Executive Officer, Tom Palmer said, "The sale of TMAC to Agnico Eagle is an excellent outcome for TMAC's shareholders, employees and local communities. Agnico Eagle's extensive experience in the Arctic, coupled with their clear commitment to the highest environmental, social and governance practices make them uniquely qualified to lead and realize the fullest potential of the Hope Bay gold district."

Ross Bhappu, Head of Private Equity Funds for RCF said, "RCF would like to compliment TMAC's current operational management team on the significant mining, milling and safety achievements and establishing the foundation from which Agnico Eagle can continue the team's outstanding track record on ESG matters as well as operating in the Arctic."

Agnico Eagle has several operating mines within Nunavut including the Meadowbanks complex and Meliadine Property. To learn more about Agnico Eagle visit: https://www.agnicoeagle.com

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