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GT Gold Corp
Symbol GTT
Shares Issued 127,751,730
Close 2021-03-10 C$ 3.21
Recent Sedar Documents

GT Gold suitor Newmont offers $3.25 per share

2021-03-10 07:13 ET - News Release

Also News Release (C-NGT) Newmont Corp

Mr. Paul Harbidge of GT Gold reports

NEWMONT TO ACQUIRE GT GOLD IN AGREED ALL-CASH TRANSACTION

GT Gold Corp. and Newmont Corp. have entered into a binding agreement, pursuant to which Newmont has agreed to acquire all of the outstanding shares of GT Gold that Newmont does not already own for $3.25 per share in cash. The total equity value pursuant to the transaction is approximately $456-million on a fully diluted basis. The transaction price represents a premium of 38 per cent to the 20-day volume-weighted average price of GT Gold's shares on the TSX-V as at March 9, 2021.

The company's flagship asset is the wholly owned, 47,500-hectare Tatogga property, located in the traditional territory of the Tahltan Nation. This is part of the highly prospective Golden Triangle region of British Columbia, Canada.

Benefits to GT Gold shareholders

  • Immediate and attractive premium for GT Gold shareholders;
  • All-cash transaction that is not subject to a financing condition;
  • Removes future dilution, commodity, development and execution risk;
  • Strong GT Gold shareholder support with voting support agreements entered with the directors and senior officers of GT Gold, Ross Beaty, The K2 Principal Fund LP and Muddy Waters LLC, representing, in aggregate, approximately 43 per cent of the outstanding shares of GT Gold.

Ashwath Mehra, executive chair of GT Gold, stated: "We are very pleased to be announcing this transaction with Newmont today, representing the execution of our plan and the culmination of significant value creation for GT Gold shareholders since the formation of the company. The transaction is a testament to the years of diligent, professional work by the entire GT Gold team. My fellow directors and I would like to express our thanks and appreciation to all who have been involved in successfully advancing the Tatogga project to this stage from discovery to sale in just over four years. The transaction is not only a great outcome for our shareholders but also one that we believe will benefit all our rightsholders and stakeholders in the coming years."

Transaction summary

The transaction will be implemented by way of a court-approved plan of arrangement under the Business Corporations Act (British Columbia) and will require the approval of: (i) 66-2/3rds per cent of the votes cast by the holders of GT Gold's common shares; and (ii) a simple majority of the votes cast by holders of GT Gold common shares after excluding votes from certain shareholders, including Newmont, as required under MI 61-101, at a special meeting of GT Gold shareholders to be held to consider the transaction. In addition to shareholder approval, the transaction is also subject to the receipt of court approval and other customary closing conditions for transactions of this nature. The transaction is expected to be completed in the second quarter of 2021.

The arrangement agreement provides for customary deal-protection provisions, including a non-solicitation covenant on the part of GT Gold and a right for Newmont to match any superior proposal (as defined in the arrangement agreement). The arrangement agreement includes a termination fee of $12.65-million, payable by GT Gold, under certain circumstances (including if the arrangement agreement is terminated in connection with GT Gold pursuing a superior proposal).

Major shareholder support

Directors and senior officers of GT Gold, collectively owning approximately 12 per cent of the outstanding shares of GT Gold, have entered into voting support agreements to support the transaction. In addition, Mr. Beaty, K2 and Muddy Waters, collectively owning approximately 31 per cent of the outstanding shares of GT Gold, have entered into voting support agreements to support the transaction.

K2 has agreed to withdraw its requisition for a special meeting of GT Gold shareholders and, as a result, the special meeting of GT Gold shareholders scheduled for April 13, 2021, has been cancelled.

GT Gold board of directors and special committee recommendations

A special committee consisting entirely of independent directors of GT Gold unanimously recommended the transaction, and the board of directors of GT Gold (excluding Dale Finn and Lana Shipley, who were recused from discussions and voting given their interests in the transaction, as Mr. Finn is Newmont's nominee on the GT Gold board, and Ms. Shipley is a partner at a law firm that advises Newmont) unanimously approved the transaction and recommends that GT Gold shareholders vote in favour of the transaction.

BMO Capital Markets and Maxit Capital LP have each provided an opinion to the GT Gold board, and Rothschild & Co has provided an opinion to the GT Gold board and the special committee, each stating that, based upon and subject to the assumptions, limitations and qualifications set forth therein, the consideration to be received by GT Gold shareholders pursuant to the transaction is fair, from a financial point of view, to GT Gold shareholders (other than Newmont).

Further details regarding the terms of the transaction are set out in the arrangement agreement, which will be publicly filed by GT Gold under its profile on SEDAR. Additional information regarding the terms of the arrangement agreement, the background to the transaction, the rationale for the recommendations made by the special committee and the GT Gold board, and how GT Gold shareholders can participate in and vote at the special meeting of GT Gold shareholders to be held to consider the transaction will be provided in the management information circular for the special meeting which will also be filed on SEDAR. Shareholders are urged to read these and other relevant materials when they become available.

Advisers and counsel

BMO Capital Markets and Maxit Capital LP are acting as financial advisers to GT Gold, and Stikeman Elliott LLP is acting as GT Gold's legal counsel. Rothschild & Co is acting as adviser to the special committee of GT Gold. Agentis Capital Mining Partners has provided technical and capital markets advice to the special committee of GT Gold.

Goodmans LLP and Lawson Lundell LLP are acting as legal counsel to Newmont.

About GT Gold Corp.

GT Gold is engaged in advancing its wholly owned, 47,500-hectare Tatogga property, located in the renowned Golden Triangle near Iskut, B.C. To date, GT Gold has made two significant discoveries on the Tatogga property -- Saddle South, a precious-metal-rich vein system, and Saddle North, a gold-rich copper porphyry system. Given the pendency of the transaction, it is expected that the preliminary economic assessment for the Saddle North project will not be completed in the time frame that had been previously announced.

About Newmont Corp.

Newmont is the world's leading gold company and a producer of copper, silver, zinc and lead. The company's world-class portfolio of assets, prospects and talent is anchored in favourable mining jurisdictions in North America, South America, Australia and Africa. Newmont is the only gold producer listed in the S&P 500 Index and is widely recognized for its principled environmental, social and governance practices. The company is an industry leader in value creation, supported by robust safety standards, superior execution and technical expertise. Newmont was founded in 1921 and has been publicly traded since 1925.

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