Endeavour Mining to buy True Gold and new African gold mine

Canadian miner Endeavour Mining Corp (TSX:EDV) has inked a friendly deal to acquire True Gold Mining (TSX-V: TGM) for about Cdn$240 million in stock.

The agreement gives Endeavour control over a low-cost gold mine in Burkina Faso about to pour its first gold within a matter of weeks.

The acquisition would increase Endeavour's gold production by about 110,000 to 120,000 ounces a year in the first five years.

Under the deal, Endeavour will pay 0.044 of its share for each True Gold share. The offer values True Gold at about C$0.57 per share, a premium of roughly 43 percent to the stock’s close on Thursday.

Endeavour said the acquisition of a 90% interest in Karma mine would increase its gold production by about 110,000 to 120,000 ounces a year in the first five years.

“The production profile and low cost of True Gold’s Karma Mine is a very attractive fit with our West African operating portfolio,” Endeavour Mining’s chief executive Neil Woodyer said in a statement.

The deal is expected to close in late April, True Gold said in a statement.