Coeur Mining to acquire New Gold for $8.51 per share

Coeur Mining (CDE) and New Gold (NGD) announced that they have entered into a definitive agreement whereby a wholly-owned subsidiary of Coeur will acquire all of the issued and outstanding shares of New Gold, pursuant to a court-approved plan of arrangement. Under the terms of the arrangement agreement, New Gold shareholders will receive 0.4959 shares of Coeur common stock for each New Gold common share. The exchange ratio implies consideration of $8.51 per New Gold common share, based on the closing price of Coeur shares of common stock on the NYSE on October 31. This represents a 16% premium to the October 31 closing price of New Gold on the NYSE American. In the aggregate, this implies a total equity value of approximately $7B based on New Gold’s common shares outstanding and a pro forma combined equity market capitalization of approximately $20B. Upon completion of the transaction, existing Coeur stockholders and New Gold shareholders will own approximately 62% and 38% of the outstanding common stock of the combined company, respectively. The combined company creates a new, 100% North American senior mining company with an approximately $20B market capitalization; seven operations producing approximately 1.25M gold equivalent ounces in 2026, including 20M ounces of silver and 900,000 ounces of gold; over 80% of its revenue generated from the U.S. and Canada, and sector-leading free cash flow. The combined company is expected to generate approximately $3B of EBITDA and approximately $2B of free cash flow in 2026 at significantly lower overall costs and higher margins, representing a material increase to Coeur’s expected 2025 full-year EBITDA and free cash flow of approximately $1B and $550M, respectively. The transaction is accretive on all of Coeur’s key per share metrics, including net asset value, operating cash flow, and free cash flow, positioning the combined company for a potential share price re-rating. The proposed transaction will be effected pursuant to a plan of arrangement under the Business Corporations Act, which is required to be approved by a British Columbia court. The transaction will require approval by 66% of the votes cast by the shareholders of New Gold at a special meeting of New Gold shareholders expected to be held in the first quarter of 2026. The transaction will also require approval of a simple majority of votes cast by the shareholders of New Gold, excluding those votes attached to New Gold common shares held by persons required to be excluded pursuant to Multilateral Instrument 61-101 – Protection of Minority Security Holder in Special Transaction. Registered shareholders of New Gold at the record date for New Gold’s shareholders’ meeting will have customary dissent rights. The issuance of shares by Coeur pursuant to the Transaction and an amendment to the Coeur certificate of incorporation to increase the number of authorized shares of Coeur stock is subject to approval by the Coeur stockholders at a special meeting also expected to be held in the first quarter of 2026. The directors and senior officers of New Gold and Coeur have entered into customary voting support agreements, pursuant to which they have committed to vote their common shares held in favor of the transaction. Upon completion of the transaction, existing Coeur stockholders and New Gold shareholders will own approximately 62% and 38% of the issued and outstanding shares of common stock of the combined company, respectively. Additionally, upon closing of the transaction, Patrick Godin and one other current New Gold director are expected to join Coeur’s board of directors. In addition to respective Coeur and New Gold court and shareholder approvals, the transaction is subject to applicable regulatory approvals, approval of the listing of Coeur shares of common stock to be issued under the transaction on the NYSE and TSX, and the satisfaction of certain other closing conditions customary for a transaction of this nature. Subject to the satisfaction of such conditions, the transaction is expected to close in H1 2026. The arrangement agreement includes customary deal protections, including reciprocal fiduciary-out provisions, non-solicitation covenants, and the right to match any superior proposals. Additionally, break fees in the amount of approximately $414M and approximately $255M are payable by Coeur and New Gold, respectively, and a reciprocal expense reimbursement fee is payable by one party to the other party in certain circumstances if the transaction is not completed. Following completion of the Transaction, New Gold common shares are expected to be de-listed from the TSX and the NYSE American. After consultation with its outside financial and legal advisors, the board of directors of Coeur has unanimously approved the transaction. The board of directors of Coeur recommends that Coeur stockholders vote in favor of the transaction. The board of directors of New Gold appointed a special committee of independent directors to consider and make a recommendation with respect to the transaction. Based on the unanimous recommendation of the New Gold Special Committee, and after consultation with its outside financial and legal advisors, the board of directors of New Gold has unanimously approved the transaction. The board of directors of New Gold recommends that New Gold shareholders vote in favor of the transaction.