Canada’s New Gold (TSX: NGD) (NYSE American: NGD) has agreed to acquire the remaining 19.9% free cash flow interest in the New Afton copper-gold mine from the Ontario Teachers’ Pension Plan for $300 million.
The deal consolidates New Gold’s ownership of New Afton, located 10km west of Kamloops, British Columbia.
“This transaction allows New Gold to fully consolidate the free cash flow exposure to one of Canada’s highest quality gold/copper assets which we already own and operate,” chief executive officer Patrick Godin said in a statement.
To finance the deal, New Gold plans to use nearly $100 million from a gold prepayment arrangement. Under this structure, the company will receive cash upfront in exchange for delivering a fixed number of gold ounces over 12 months. Based on current pricing, the committed ounces represent about 8% of New Gold’s expected consolidated gold production…
