Caledonia Mining (TSX: CAL, NYSE: CMCL) has agreed to acquire a 15% stake in Fremiro Investments for $ 16.6 million in Zimbabwe blanket gold mines. After completing the transaction, Caledonia will own 64% of the blankets.
Under the terms of the deal, the two companies will cancel a US $ 11.4 million Calderon loan to Primero. Caledonia will issue 727,266 shares of Fremiro for $ 7.15 per share, New York Stock Exchange Fremiro will own 6.42% of the diluted equity of Caledonia.
Caledonia produced almost 14,000 ounces. Blankets for the third quarter of 2018
Caledonia produced almost 14,000 ounces. Blankets for the third quarter of 2018 were up 3% from the same period last year, but increased 10% from the second quarter of 2018. The company produced 39,559 ounces. Gold is slightly less in the first three quarters of 2018 than in the first three quarters of 2017.
As a result, the company reduced production guidelines from 55,000 to 59,000 ounces in 2018. 54,000 to 56,000 ounces of gold. gold. However, in 2021, it is said that the production target has reached 80,000 ounces. gold.
The company has lowered its adjusted earnings guidance from $ 1.65 to $ 1.90 per share from $ 1.40 to $ 1.50, combined with lower interest rates and weaker gold prices. Revised revenue guidance is 3% to 12% higher than company earnings in 2017.
Caledonia acquired the Blanket mine in Kinross Gold (TSX: K; NYSE: KGC) in April 2006, and its interest rate fell to 49% following the privatization in 2012, which resulted in a 51% increase in Zimbabweans' % Of the shares had to be sold. Caledonia lent money because Fremiro could not afford the interest.
Caledonia mining stocks are currently trading at $ 7.19 and 52 shares are trading at $ 6.80 to $ 12.50. The company's market capitalization is $ 72 million.