Chaparral Gold (TSX:CHL, StockForum), a Toronto-based mineral exploration firm, announced today that the company had received an acquisition offer from Waterton Precious Metals Fund II Cayman to purchase all issued and outstanding shares of Chaparral not already held by it or its affiliates for $0.50 per share.
Waterton's acquisition offer represents a premium of approximately 22.5% based on the volume-weighted average price of Chaparral on the TSX for twenty days ended on February 14, 2014 and a premium of approximately 14.9% over the closing price of Chaparral shares on the TSX on February 14, 2014.
Presently, Waterton owns 3.4 million shares in Chaparral, representing 2.9% of the issued and outstanding shares in the company.
Waterton's management considers the fully-financed offer to be advantageous to Chaparral shareholders by virtue of its “attractive” premium, immediate liquidity, cash consideration and certainty of value and the low likelihood of a competing offer that would match the premium given by Waterton.
According to the news release, “The Offer will be open for acceptance until 5:00 p.m. (Toronto time) on March 27, 2014 unless the Offer is extended or withdrawn. The Offer will be subject to customary conditions, including there being validly deposited under the Offer such number of Chaparral shares which, together with the Chaparral shares directly or indirectly owned by Waterton and its affiliates, constitutes at least 662/3% of the total outstanding Chaparral shares (on a fully diluted basis), no material adverse changes, and receipt of all necessary governmental or regulatory approvals. The Offer is fully financed and is not conditional on financing.”
Chaparral Gold was in the news recently when the company provided a corporate update at the top of the month.
Shares jumped 24.14% on the news to $0.54 per share.
Currently there are 117.6m outstanding shares with a market cap of $63.5 million.