Teranga Gold, Barrick complete transaction for Massawa project
(Kitco News) - Teranga Gold Corp. (TSX: TGZ) said late Wednesday that it has completed the previously announced acquisition of a 90% interest in the Massawa gold project from a subsidiary of Barrick Gold Corp. and its joint-venture partner, Compagnie Sénégalaise de Transports Transatlantiques Afrique de l’Ouest SA.
The government of Senegal holds the remaining 10% interest. The Massawa mine is located near Teranga’s Sabodala gold mine.
“Now that the transaction is complete, we are turning our focus to integrating the high-grade Massawa deposits into our mine plan and leveraging our existing infrastructure at Sabodala,” said Richard Young, president and chief executive officer of Teranga. “The combination of the two assets results in significant capital and operating synergies and creates a top-tier gold complex.”
The purchase price of $380 million consisted of some $300 million in cash and $80 million in Teranga common shares issued to Barrick and CSTTAO. Barrick said there is also the potential for an additional payment based on the average gold price for the next three years.
Mark Bristow, Barrick president and chief executive officer, described Massawa as one of the largest unexploited gold deposits in West Africa, developed enough so its value can now be realized by all stakeholders, including the Senegal government.
“Teranga is best placed to achieve this as it already owns the nearby Sabodala mine, and Sabodala’s combination with Massawa is expected to deliver significant synergies,” Bristow said. “Barrick will participate in the upside of the combined asset through the 11% interest it is acquiring in Teranga through this transaction.”