Silvercorp Metals Inc., a Canadian based company which is also China’s largest primary silver producer, has entered into a definitive agreement to acquire all of the issued and outstanding shares of Guyana Goldfields Inc. The Guyana Standard understands that the US$74.9M transaction will create a diversified precious metals producer with two profitable underground silver mining operations in China and a gold mining operation in Guyana with a strong balance sheet to fund growth opportunities.

Under the terms of the transaction, each holder of Guyana Goldfields shares will have the option to receive C$0.60 in cash or 0.1195 of a Silvercorp common share valued at C$0.60 based on the volume weighted average price for Silvercorp common shares for the 20 trading days that ends April 24, 2020, subject to a maximum cash consideration of C$33.2 million.

Concurrently, with entering the agreement, Silvercorp and Guyana Goldfields have also entered into a loan agreement, whereby Silvercorp will lend Guyana Goldfields up to US$15 million with a defined use of proceeds related to ongoing operations at the Aurora Underground Project, as well as for certain working capital and general corporate purposes.

In 2011, Guyana Goldfields Inc., a Canadian based company, was awarded 20-year large scale mining licence in the Cuyuni region. The company operates in Guyana through its wholly-owned Guyanese company Aurora Gold Mine (AGM). AGM started commercial production in January 2016 and it estimates the average annual gold production to be 218,000 ounces over the next five years.


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