Exeter Resource Corporation (NYSE-MKT:XRA)
(TSX:XRC) (Frankfurt:EXB)
(“Exeter” or the
“Company”) is pleased to announce that it has entered into
a definitive agreement (the "Agreement") with Goldcorp Inc.
(NYSE:GG) (TSX:G) ("Goldcorp"), whereby Goldcorp will acquire all
of the outstanding shares of Exeter under a plan of arrangement for
consideration of 0.12 of a Goldcorp share for each Exeter share,
which represents a value equivalent to C$2.58 per Exeter share,
based on the closing price of Goldcorp shares on the TSX on March
27, 2017, and total consideration of C$247 million.
This represents a premium of 67% on the Exeter
shares based on the closing prices of both companies common shares
on the TSX on March 27, 2017 and a 60% premium based on Goldcorp’s
and Exeter’s 20‐day TSX volume weighted average trading price
ending on March 27, 2017.
Exeter's Board of Directors has unanimously
approved the transaction and recommends that Exeter shareholders
vote in favour of the arrangement. All of the directors and
officers of Exeter, who own or control approximately 8.4% of
Exeter's issued and outstanding shares, have entered into support
agreements with Goldcorp pursuant to which they have agreed, among
other things, to support the transaction and vote their Exeter
shares in favour of the arrangement.
Scotiabank and Paradigm Capital Inc., have
provided opinions to the Exeter Board of Directors and the special
committee of independent directors of Exeter, respectively, that as
of the date of such opinions and subject to the assumptions,
limitations, and qualifications stated in such opinions, the
consideration to be received by the Exeter shareholders under the
transaction is fair, from a financial point of view, to the Exeter
shareholders (other than Goldcorp and its affiliates).
Benefits to Exeter
Shareholders
- Secures immediate value appreciation for Exeter shareholders,
eliminating the burden of future dilution as would be necessary to
move the Caspiche project forward.
- Based on March 27, 2017 closing prices, the 0.12 of a Goldcorp
share offered for each Exeter share represents - Total
consideration of approximately C$247 million, or C$2.58 per
share. - Premium of 67% to Exeter's closing share price on
March 27, 2017. - Premium of 60% to the volume weighted
average trading price of Exeter shares on the TSX for the 20-day
period ending on March 27, 2017.
- Goldcorp is the world's fourth largest gold producer, with
high-quality, low-cost production and an investment grade balance
sheet.
- Conversion of Exeter shares to Goldcorp shares provides
exposure to Goldcorp's portfolio of diversified, world-class assets
in low political risk jurisdictions.
- Goldcorp with its joint venture partner in the Maricunga Gold
Belt, Barrick Gold Corporation (TSX:ABX) (NYSE:ABX) have the
technical and financial capability to advance the Caspiche project
to production at a scale commensurate with the size of the
available resources.
Co-Chairman of Exeter, Yale Simpson stated,
“Since the discovery of Caspiche in 2007, our team successfully
delineated and technically advanced one of the largest gold –
copper deposits in the Americas. While advancing the near surface
1.7 million ounce gold oxide open pit is a sensible starter option
for Exeter, the enormous scope of the Caspiche gold-copper sulphide
project requires both the capital and technical expertise of a
major mining company to unlock its true value. Goldcorp, a leading
gold producer with a strong track record of responsible mining is
both capable and motivated to develop a mine at Caspiche. Exeter
shareholders receive an immediate, attractive premium in this
transaction. Through the Goldcorp shares received they retain their
exposure to the Caspiche project, but without the adherent
financial risk that would challenge Exeter.”
Closing of the transaction is subject to various
conditions, which are standard for a transaction of this nature,
including receipt of Exeter shareholder, court and regulatory
approval. Full details of the transaction will be set out in
Exeter's information circular that it will prepare in respect of
the meeting of shareholders to approve the transaction, to be held
on or before May 31, 2017. Exeter intends to mail the information
circular by mid-April, 2017. The transaction is expected to close
no later than June 30, 2017.
Pursuant to the arrangement, Exeter is subject
to customary non-solicitation covenants. In the event a superior
proposal is made to Exeter, Goldcorp has the right to match such
proposal. Under certain circumstances where the transaction is not
completed, Exeter has agreed to pay a termination fee of C$8.65
million to Goldcorp.
Exeter has engaged Scotiabank as its financial
advisor and Gowling WLG (Canada) LLP in Canada, Dorsey &
Whitney LLP in the United States, and Bofill Mir & Álvarez Jana
in Chile as its legal advisors in connection with the
transaction.
Copies of the Agreement, support agreements,
management information circular, when available, and certain
related documents will be filed with securities regulators and will
be available on SEDAR at www.sedar.com and on EDGAR at
www.sec.gov.
None of the securities to be issued pursuant to
the Arrangement Agreement have been, or will be registered under
the United State Securities Act of 1933, as amended (the “U.S.
Securities Act”), or any applicable securities law of any state of
the United States and may not be offered or sold in the United
States or to, or for the account or benefit of a U.S. person,
absent such registration or an exemption therefrom. It is
anticipated that any securities to be issued under the Arrangement
will be offered and issued in reliance upon the exemption from such
registration requirements provided by Section 3(a)(10) of the U.S.
Securities Act and pursuant to applicable exemptions under state
securities laws. This press release does not constitute an offer to
sell or the solicitation of an offer to buy any securities. “United
States” and “U.S. person” are as defined in Regulation S under the
U.S. Securities Act.
About Exeter Resource
Corporation:
Exeter is a Canadian mineral exploration company
focused on the exploration and development of the Caspiche project
in Chile. Caspiche is well located in Chile’s Maricunga district,
which has good infrastructure and is in close proximity to other
large scale mining operations and projects in development.
About Goldcorp:
Goldcorp is a senior gold producer focused on
responsible mining practices with safe, low-cost production from a
high-quality portfolio of mines.
For further information about Goldcorp, please
visit their website at www.goldcorp.com
On behalf of Exeter Resource Corp,Mr.
Wendell M. Zerb, P. GeolPresident & Chief
Executive Officer
Safe Harbour Statement – This
news release contains “forward-looking information” and
“forward-looking statements” (together, the “forward-looking
statements”) within the meaning of applicable securities laws and
the United States Private Securities Litigation Reform Act of 1995,
including in relation to management's assessment of the benefits to
shareholders of the proposed transaction with Goldcorp, anticipated
mailing and meeting days, timing for completion of the transaction,
the Company’s belief as to the potential significance of water
discovered and the potential to utilize the desalinated water
secured under option, the timing and completion of a new
preliminary economic assessment or other studies for the
advancement of Caspiche, including a production decision on the
oxide project, the potential to establish new opportunities for the
advancement of Caspiche, results from the 2014 PEA including
estimated annual production rates, capital and production costs or
expected changes to such costs, water and power requirements and
metallurgical recoveries, expected taxation rates, potential for
securing water rights and adequate water and potential approval of
water extraction, potential for reduced power costs, potential to
acquire new projects and expected cash reserves. These
forward-looking statements are made as of the date of this news
release. Readers are cautioned not to place undue reliance on
forward-looking statements, as there can be no assurance that the
future circumstances, outcomes or results anticipated in or implied
by such forward-looking statements will occur or that plans,
intentions or expectations upon which the forward-looking
statements are based will occur. While the Company has based
these forward-looking statements on its expectations about future
events as at the date that such statements were prepared, the
statements are not a guarantee that such future events will occur
and are subject to risks, uncertainties, assumptions and other
factors which could cause events or outcomes to differ materially
from those expressed or implied by such forward-looking statements.
Such factors and assumptions include, among others, the receipt of
all shareholder and regulatory approvals, no undue delays with
respect to the transaction, effects of general economic conditions,
the price of gold, silver and copper, changing foreign exchange
rates and actions by government authorities, uncertainties
associated with negotiations and misjudgments in the course of
preparing forward-looking information. In addition, there are known
and unknown risk factors which could cause the Company’s actual
results, performance or achievements to differ materially from any
future results, performance or achievements expressed or implied by
the forward-looking statements. Known risk factors include risks
associated with failure to complete the transaction, project
development; including risks associated with the failure to satisfy
the requirements of the Company’s agreement with Anglo American on
its Caspiche project which could result in loss of title; the need
for additional financing; operational risks associated with mining
and mineral processing; risks associated with metallurgical
recoveries, risks associated with operating in areas subject to
drought conditions and scarcity of available water sources, power
availability and changes in legislation affecting the use of those
resources; fluctuations in metal prices; title matters; uncertainty
and risks associated with the legal challenge to the easement
secured from the Chilean government; uncertainties and risks
related to carrying on business in foreign countries; environmental
liability claims and insurance; reliance on key personnel; the
potential for conflicts of interest among certain officers,
directors or promoters of the Company with certain other projects;
the absence of dividends; currency fluctuations; competition;
dilution; the volatility of the Company’s common share price and
volume; tax consequences to U.S. investors; and other risks and
uncertainties, including those described herein and in the
Company’s Annual Information Form for the financial year ended
December 31, 2016 dated March 24, 2017 filed with the Canadian
Securities Administrators and available at www.sedar.com and filed
with the SEC as part of the Company’s annual report on Form 40-F
available at www.sec.gov. Although the Company has attempted
to identify important factors that could cause actual actions,
events or results to differ materially from those described in
forward-looking statements, there may be other factors that cause
actions, events or results not to be as anticipated, estimated or
intended. There can be no assurance that forward-looking statements
will prove to be accurate, as actual results and future events
could differ materially from those anticipated in such statements.
Accordingly, readers should not place undue reliance on
forward-looking statements. The Company is under no obligation to
update or alter any forward-looking statements except as required
under applicable securities laws.
Cautionary Note to United States Investors -
Exeter is required to describe mineral resources associated with
its properties utilizing Canadian Institute of Mining, Metallurgy
and Petroleum ("CIM") definitions of "measured mineral resources",
"indicated mineral resources" and "inferred mineral resources" are
defined in and are required to be disclosed pursuant to Canadian
regulations; however, these terms are not defined terms under the
United States Securities and Exchange Commission’s Industry Guide 7
and normally are not permitted to be used in reports and other
documents filed with the SEC. Investors are cautioned not to assume
that any part or all of mineral deposits in these categories will
ever be converted into SEC Industry Guide 7 compliant mineral
reserves. "Inferred mineral resources" have a great amount of
uncertainty as to their existence and as to their economic and
legal feasibility. It cannot be assumed that all or any part of an
inferred mineral resource will ever be upgraded to a higher
category. Under Canadian rules, estimates of inferred mineral
resources may not form the basis of feasibility or pre-feasibility
studies, except in rare cases. Disclosure of "contained ounces" in
a mineral resource is permitted disclosure under Canadian
regulations. However, the SEC normally only permits issuers to
report mineralization that does not constitute "mineral reserves"
by SEC Industry Guide 7 standards as in place tonnage and grade,
without reference to unit measures. Accordingly, information
contained in this press release or referenced herein containing
descriptions of mineral deposits may not be comparable to similar
information made public by U.S. companies subject to the reporting
and disclosure requirements under the United States federal
securities laws and the rules and regulations thereunder, including
SEC Industry Guide 7.
NEITHER THE TSX NOR ITS REGULATION
SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE
TSX) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS
NEWS RELEASE
For further information, please contact:
Wendell Zerb, CEO or
Rob Grey, VP Corporate Communications
Tel: 604.688.9592 Fax: 604.688.9532
Toll-free: 1.888.688.9592
Suite 1660, 999 West Hastings St.
Vancouver, BC Canada V6C 2W2
exeter@exeterresource.com