By Joe Hoppe
AngloGold Ashanti Ltd. said Tuesday it has submitted a proposal to acquire all of the outstanding issued shares of Corvus Gold Inc., for an estimated $370 million.
The Johannesburg-based mining company, which already holds a 19.5% indirect interest in gold exploration and development company Corvus, will offer shareholders 4.0 Canadian dollars ($3.20) a share, payable in cash. The offer is a 23% premium to the closing share price of Corvus prior to the submission of the proposal, and AngloGold estimated the total proposed cash consideration to be around $370 million.
AngloGold said the acquisition would fit its strategy of growing its ore reserves, building low-cost production and generating sustainable returns. The acquisition and combination of Corvus and AngloGold's assets in Nevada would also create one of the largest new gold districts in the state, allowing for greater economies of scale and integrated infrastructure.
The company said it is working closely with the management of Corvus to agree the terms of, and implement the transaction.
Shares in AngloGold in Johannesburg at 1425 GMT were up ZAR4.81 pence, or 1.7%, at ZAR289.04 pence.
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(END) Dow Jones Newswires