Australia's Silver Lake to buy Integra Mining for $450 million
SYDNEY (Reuters) - Australia's Silver Lake Resources (SLR.AX) on Monday said it will acquire Integra Mining IGR.AX in an all-scrip deal to create a gold miner with a market value of nearly $1 billion.
Silver Lake said in a statement it will issue one share for every 6.28 Integra shares under the offer, valuing Integra at 45.2 cents a share or A$426 million ($450 million) based on Friday's closing price.
Integra shares, which were near a two-year low on Friday, rose as much as 30 percent after the announcement. Silver Lake dropped over 10 percent.
The deal was done at a time when smaller companies are looking to join up as funding becomes harder to get.
Dramatic drops in prices for everything from copper and nickel to iron ore and zinc as China cuts down on imports call into question the viability of new mining projects -- scaring away potential funding for them.
Australia and New Zealand Banking Group (ANZ.AX) last week cut its commodity price forecasts an average 4 percent for 2012 and 3.4 percent for 2013.
Integra raised A$25 million last month for exploration and debt repayment.
Silver Lake and Integra said the deal would create a gold producer boasting a 6.6 million ounce resource base, with current production of 200,000 ounces projected to more than double in 2014. They added the combined firm would have A$107 million in cash.
($1 = 0.9476 Australian dollars)
(Reporting by Narayanan Somasundaram; Editing by Eric Meijer)
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