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White Tiger Gold to join forces with Century Mining

The two small Canadian miners, controlled or partially controlled by Russian investor Maxim Finskiy have said the new group will retain the White Tiger name but Century shareholders will get 61% stake in the enlarged entity

Posted: Tuesday , 15 Mar 2011

TORONTO (Reuters) - 

Two small Canadian gold miners controlled or partially controlled by Russian investor Maxim Finskiy will combine forces in a deal that will keep the White Tiger Gold Ltd (WTG.TO: Quote) name, but offer shareholders of Century Mining Corp (CMM.V: Quote) a 61 percent stake.

Century shareholders will receive 0.40 of a White Tiger share for each share they hold in Century, the companies said on Monday.

Thomson Reuters data show Finskiy has a 34 percent stake in Century. He also has a majority stake in White Tiger, which went public in December through a reverse takeover.

Based on the number of shares outstanding as shown on the company's web site, and on prices before the deal was announced, the exchange ratio of the shares, would value the transaction at some C$855 million ($725 million).

Shareholders of Century Mining will end up owning 61 percent of White Tiger, on a fully diluted, pro forma basis.

Century Mining has some 408 million shares outstanding, and Finskiy owns some 34 percent of those. He also owns about 75 percent of White Tiger Gold.

White Tiger owns the Savkino gold mine and has rights to five gold properties in Russia, while Century owns the Lamaque gold mine in Quebec and the San Juan mine in Arequipa, Peru.

The combined entity will produce between 111,000 and 121,000 ounces of gold in 2011 and the companies expect that to rise to several hundred thousand ounces in a few years.

Shares of Century Mining jumped 14 percent to 66 Canadian cents a share after paring earlier gains of as much as 41 percent. Shares of White Tiger, which were halted for trading since Friday, fell 23 percent to C$3.50 a share.

The boards of each company support the deal, and have established special committees to review it.

The White Tiger's committee retained Moelis & Company LLC as advisors and the Century retained Blair Franklin Capital Partners Inc. (Reporting by Pav Jordan in Toronto and Savio D'Souza in Bangalore; Editing by Sriraj Kalluvila and Janet Guttsman)

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