Agnico Eagle (TSX, NYSE: AEM) is set to take a 9.9% stake in Finland-focused Rupert Resources (TSX-V: RUP) to gain access to the junior’s flagship Pahtavaara gold project, located 50 km away from the Canadian company’s Kittila mine.
The Toronto-based miner, which also
has operations in Canada and Mexico, will invest C$13.1 million (about $9.8m) in
the Finish explorer through a non-brokered placement at 85c per unit. The deal is
expected to help unlock the potential of Pahtavaara and validate Rupert’s exploration
in the region.
“The new investment is expected to fund Rupert’s exploration campaign for at least 12 months and may lead to synergies in the event Rupert’s projects progress to the development stage,” the company’s chief executive, James Withall, said in a statement.
As part of the transaction, Agnico
Eagle subscribed to 15.3 million in a non-brokered private placement at a price
of 85 cents per unit. The senior gold company, in operations since 1957, was
also granted certain ownership rights, including the right to nominate one
person to Rupert’s board.
The explorer contiguous land
package is located in the centre of a region which hosts Agnico’s 200,000-ounces-a-year
Kittila operation — Europe’s largest gold mine.
The underground mine produced 189,000 ounces of
gold in 2018 with cash costs of $835 per ounce of gold.