Wallbridge Mining Co. (WM.TO) agreed Monday to acquire all of the issued and outstanding shares of Balmoral Resources Ltd. (BAR.TO) in an all-stock transaction valued at about C$110 million, pursuant to a plan of arrangement.
Under the terms of the transaction, all of the issued and outstanding shares of Balmoral will be exchanged at a ratio of 0.71 of a Wallbridge common share for each Balmoral common share. Upon completion of the transaction, existing Wallbridge and Balmoral shareholders will own approximately 82% and 18% of the Company's pro forma issued and outstanding shares, respectively.
The exchange ratio implies consideration of C$0.62 per Balmoral common share and a premium of 60% to the closing price of the Balmoral common shares on the TSX on February 28, 2020. This is based on the volume weighted average price of Wallbridge common shares on the Toronto Stock Exchange for the 20 trading days ending February 28, 2020.
The Transaction will be affected by way of a court-approved plan of arrangement under the Business Corporations Act. It is subject to approvals from the Toronto Stock Exchange, as well as other conditions. The Arrangement Agreement also provides for a termination fee of C$2.5 million
Balmoral's Board of Directors has determined that the combination is in the best interests of Balmoral and has unanimously recommended that Balmoral shareholders vote in favour of the transaction.
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