Stillwater Mining to acquire Canada’s Peregrine Metals for $487.1 million

Platinum and palladium producer Stillwater Mining Co yesterday said that it will buy Canada's Peregrine Metals for $487.1 million in a cash and stock deal, to diversify and expand its copper and gold deposits in Argentina.

"For several years, one of Stillwater's primary strategic goals has been to grow and diversify our business through the acquisition and development of high-quality mining assets.

The Peregrine transaction provides us with broader diversification into copper -- a metal with favourable long-term fundamentals driven by growing market demand -- as well as meaningful exposure to gold," said Frank McAllister, Stillwater's chairman and CEO.

Under the terms of the transaction that has been approved by the board of both companies, Peregrine shareholders will receive 59 per cent of newly issued Stillwater shares and 41 per cent in cash. Stillwater will exchange 0.08136 Stillwater shares and $1.35 in cash for each Peregrine share.

Holders of Peregrine stock options may opt to exchange their options for options exercisable solely for Stillwater shares, upon payment of the exercise price, on the equivalent basis of one Peregrine share for 0.14793 of a Stillwater common share, said Stillwater in a statement.

Upon completion of the transaction, Stillwater and Peregrine shareholders will own approximately 89.5 per cent and 10.5 per cent, respectively, of the combined company.

Vancouver, Canada-based Peregrine Metals owns and operates the Peregrine's Altar porphyry copper-gold deposit, a large, undeveloped open-pit resource located in the San Juan province of Argentina.