Auryn to acquire Eastmain Resources, creating a Canadian gold developer

Auryn Resources Inc. and Eastmain Resources Inc. entered into a definitive agreement pursuant to which Auryn will acquire all of the issued and outstanding shares of Eastmain, immediately following a spin-out of Auryn’s Peruvian projects to Auryn shareholders and completion of a concurrent financing. The completion of the transaction will result in Auryn continuing its Canadian operations under the name Fury Gold Mines Limited and two independent spin-out entities (“SpinCos”) holding Auryn’s Peruvian projects.

Concurrent with the spin-out, Auryn will consolidate its shares by approximately 10:7 such that approximately 110 million Fury Gold shares will be outstanding after the Eastmain acquisition, of which 69 per cent will be owned by current Auryn shareholders and 31 per cent will be owned by current Eastmain shareholders. Pursuant to the closing of the transaction, Eastmain shareholders will be entitled to receive approximately 0.117 of a Fury Gold share for each Eastmain share. After adjustment for the assumed value of the SpinCo shares, the $121 million offer represents approximately $0.42 per Eastmain share, representing a premium of 137 per cent to the closing market price of the Eastmain shares on July 29.

The transaction is expected to close before the end of 2020.

McMillan LLP is acting as counsel for Auryn with a deal team that includes Bernhard Zinkhofer, Cory Kent, Michael Taylor, Ravipal Bains, Gavyn Backus and Jordan Ghag (securities, M&A and mining), Sonia Rainville and Marie-Lou Beaumont (real estate – Quebec). 

Thorsteinssons LLP is acting as Canadian tax counsel for Auryn with a team led by Richard Wong

Dorsey & Whitney LLP is acting as US tax counsel for Auryn with a team led by John Hollinrake.

Blake, Cassels & Graydon LLP is acting as counsel to Auryn’s Special Committee with a team consisting of Bob Wooder and Kathleen Keilty (M&A).

Cassels Brock & Blackwell LLP is acting for Eastmain with a deal team that includes Jay Goldman, Lindsay Clements, Jennifer Campbell, Jasmine Qin and Tiffany Chiu (securities, M&A and mining), Chris Norton (tax), and Robert Lysy (real estate and development).