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Mining industry

NovaGold Resources Inc. Announces Acquisition of Copper Canyon Resources Ltd.

Strategic Insights

— 2 min read

NovaGold Resources Inc., a leading precious metals company, has filed a formal offer to acquire all of the outstanding shares of Copper Canyon Resources Ltd. as of January 18, 2011. Under the terms of the offer, Copper Canyon shareholders will receive 0.0425 of a NovaGold common share for every common share of Copper Canyon. The offer represents a premium of approximately 41.8% and 33.4% based on the closing prices on December 17, 2010, and the 20-day volume-weighted average prices, respectively. The offer is subject to certain conditions, including the Copper Canyon shareholder rights plan being waived, invalidated, or cease-traded, and validly deposited shares making up at least 66 2/3% of the outstanding common shares on a fully-diluted basis.

Key Takeaways:

  • NovaGold Resources Inc. has filed a formal offer to acquire all outstanding shares of Copper Canyon Resources Ltd., with a premium of approximately 41.8% and 33.4% based on December 17, 2010, prices and 20-day volume-weighted averages, respectively.
  • Copper Canyon shareholders will receive 0.0425 of a NovaGold common share for every common share of Copper Canyon.
  • The offer is subject to conditions, including the Copper Canyon shareholder rights plan being waived, invalidated, or cease-traded, and validly deposited shares making up at least 66 2/3% of the outstanding common shares on a fully-diluted basis.
  • NovaGold's financial adviser is TD Securities Inc., and its legal advisors are Blake, Cassels & Graydon LLP in Canada and Dorsey & Whitney LLP in the United States.
  • Copper Canyon shareholders wishing to accept the offer are encouraged to act as soon as possible and tender their shares by February 23, 2011, at 5:00 pm (Eastern Time).
  • NovaGold is a precious metals company engaged in the exploration and development of mineral properties in Alaska and British Columbia, with a strong track record of expanding deposits through exploration success and collaborative partnerships.
  • NovaGold's core properties include the Donlin Creek and Galore Creek projects, with a large reserve/resource base and the objective of becoming a low-cost million-ounce-a-year gold producer.

Statistics:

  • Closing prices on December 17, 2010: NovaGold, TSX: $NG, $11.00; Copper Canyon, TSX-V: CPY, $7.34.
  • 20-day volume-weighted average prices on December 17, 2010: NovaGold, TSX: $NG, $10.90; Copper Canyon, TSX-V: CPY, $6.90.
  • Offer premium: approximately 41.8% based on closing prices and 33.4% based on 20-day volume-weighted averages.
  • Validly deposited shares required: at least 66 2/3% of the outstanding common shares on a fully-diluted basis.
  • Deadline for acceptance: February 23, 2011, at 5:00 pm (Eastern Time).

Sources:

  • NovaGold Resources Inc.
  • Copyright 2011 Marketwire, Inc. (January 18, 2011)
  • Comtex SmarTrend Alert (January 14, 2011)
  • NovaGold Resources Inc. Annual Information Form for the year ended November 30, 2009
  • NovaGold Resources Inc. annual report on Form 40-F filed with the US Securities and Exchange Commission

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