IAMGOLD Completes $20 Million Private Placement in Orezoneadmin
IAMGOLD Corporation completed the previously announced purchase on a private placement basis of 71,428,571 common shares of Orezone Resources Inc. at a price of Cdn$0.28 per share for gross proceeds to Orezone of Cdn$20 million. As a result, IAMGOLD holds approximately 16.6% of the outstanding shares of Orezone. IAMGOLD did not hold any securities of Orezone prior to the private placement.
On December 11, 2008, IAMGOLD and Orezone jointly announced a business combination. The private placement was completed pursuant to the definitive arrangement agreement dated December 10, 2008, whereby IAMGOLD would acquire, via a plan of arrangement, all of the outstanding common shares of Orezone in a supported, all-share transaction. Total consideration to be provided to shareholders of Orezone under the Transaction is valued at approximately US$139 million. Completion of the Transaction is subject to, among other things, the approval by the shareholders of Orezone at a special meeting of shareholders of Orezone, and final court approval. The Transaction is expected to close by the end of February 2009.
Orezone’s main asset is the fully permitted, 4 million ounce Essakane gold resource, located in Burkina Faso, West Africa. Construction commenced in September of this year for a mine that will contribute average gold production of over 300,000 ounces per year over a minimum nine-year mine life. Average cash operating cost is estimated at US$358 per ounce, using a $600 per ounce gold price and $85/bbl oil price. Full production is anticipated in late 2010, requiring a remaining capital expenditure of approximately US$350 million.