Coeur Mining Inc. (NYSE: CDE) is buying Paramount Gold and Silver Corp. (NYSE, TSX: PZG) in an all-stock transaction valued at $146 million.
Paramount, headquartered in Winnemucca, Nevada, is a gold and silver exploration company. The company has projects in Nevada and Mexico. The company's stock price rose after the deal was announced. Paramount stock closed at $0.65 on Dec. 16, and opened at $0.85 on Dec. 17.
Before the deal closes, Paramount will spin-off a new publicly traded company, expected to be named Paramount Nevada Gold Corp. to current shareholders, which will own the Sleeper Gold Product and other assets in Nevada. Coeur will provide the new company with $10 million in cash for a 4.9 percent stake.
Coeur is a silver and gold producer headquartered in Chicago. The company has natural resources exploration activities in Alaska, Argentina, Bolivia, Mexico and Nevada. Coeur has a history of acquisitions, and agreed to several deals in 2013, including the $24 million purchase of Global Royalty Corp., and $382 million purchase of Orko Silver Corp. The company's stock value decreased after the deal was announced - it closed at $4.57 on Dec. 16, and opened at $4.44 on Dec. 17.
Gibson Dunn & Crutcher LLP advised Coeur on the deal.