The Evolution Mining Ltd (ASX: EVN) share price is backtracking during market open, despite announcing a positive acquisition update.
At the time of writing, the gold miner's share price is swapping hands for $5.02, down 0.59%.
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What did Evolution announce?
Investors are dragging down Evolution shares following its latest update to the ASX.
According to this morning's release, Evolution advised that Canadian-listed Battle North Gold Corp (TSE: BNAU) shareholders have approved the proposed acquisition.
Evolution tabled an offer in the middle of March to acquire all the issued share capital of Battle North. A definitive arrangement agreement valued the outstanding shares of Battle North at a price of $2.79 (C$2.65) apiece. This equates to a cash consideration of roughly $362 million (C$343 million), a 46% premium on the market day before the announcement.
Whilst shareholders agreed to the sale, the transaction still needs approval by the Supreme Court of British Columbia. The hearing is scheduled to occur next Monday, 17 May. If the court gives the go-ahead, settlement is expected to be finalised on 19 May 2021.
Evolution executive chair, Jake Klein touched on the favourable outcome, saying:
It's pleasing to see the overwhelmingly positive support for the Transaction from Battle North shareholders. This acquisition provides Evolution with an opportunity to expand our footprint in the Red Lake region and create value by leveraging the infrastructure of the two operations.
The additional processing capacity from the new Bateman mill will also accelerate our ability to achieve our objective of producing in excess of 300,000 ounces of gold per annum from Red Lake.
About the Evolution share price
Evolution is an Australian mining and exploration company that owns and operates five gold and silver mines in New South Wales, Queensland and Western Australia.
The Evolution share price has been on a rocky period over the last 12 months, down almost 10%. Although, the company's shares slumped in early 2021, year-to-date performance remains relatively flat, up 1%.
On valuation grounds, Evolution commands a market capitalisation of around $8.6 billion, with approximately 1.7 billion shares outstanding.
