AuRico Gold dumps Australian mines for $105 million
AuRico Gold pulled the trigger on its Australian operations on Tuesday, selling the Stawell and Fosterville mines to Crocodile Gold Corp for up to $105 million.
The cash and stock deal included $70 million in guaranteed cash.
AuRico (TSX:AUQ) acquired the mines last summer when it purchased Northgate Minerals Corp, a transaction that also netted the Young-Davidson mine in Ontario.
The Financial Post reports that AuRico's plan was always to divest its high-cost Australian operations to focus its core assets in North America.
The paper quotes an analyst at Desjardins Securities saying that AuRico got a good value for the Fosterville and Stawell mines, which it valued at a respective US$168 million and $131 million:
“It provides AuRico with immediate cash and allows management to direct its full attention to its strong portfolio of North American assets — particularly the ramp-up of Young-Davidson,” he wrote in a note. He reiterated his buy rating on AuRico and price target of $14.25 a share.
Crocodile Gold pushed up 10% today to 54 cents on the Toronto Venture Exchange.