…to provide loan of US$30M for Aurora Gold Mines operations

GUYANA Goldfields Inc., on Wednesday, announced that it has received a binding proposal from Silvercorp Metals Inc. — a foreign-based multinational mining company — for the acquisition of all of the issued and outstanding common shares of the company not already owned by the new offeror.

According to a press release from Guyana Goldfields Inc., the company’s Board of Directors has unanimously determined, after consultation with its financial and legal advisers, that the offer constitutes a “Superior Proposal” in accordance with the terms of the arrangement agreement between the Guyana Goldfields Inc. and Silvercorp Metals Inc., dated April 26, 2020, as amended on May 16, 2020.

The release said that pursuant to the terms of the new offer, the company’s shareholders would receive cash consideration of C$1.85 for each common share, valuing Guyana Goldfields at approximately C$323M.

It said that Silvercorp has agreed to provide Guyana Goldfields Inc. with a US$30M secured loan facility to finance ongoing operations of the Aurora gold mine and to fund other liquidity needs.

The press release said that at this time, “there can be no assurance that the new offer will lead to a termination of the Silvercorp Arrangement Agreement and the execution of a definitive agreement with the new offeror and, accordingly, the board has not changed its recommendation regarding the offer under the Silvercorp Arrangement Agreement.”
In providing a disclosure update, Guyana Goldfields Inc. said that it has delayed the delivery of its annual financial statements for the year ended December 31, 2019 in light of the challenges posed by the COVID-19 pandemic. “The company expects to be in a position to mail the 2019 financial statements … to shareholders by the deadline of July 3, 2020,” the press release said.