July 5, 2016 / 8:12 PM / a year ago

BRIEF-Centerra Gold to buy Thompson Creek Metals for $1.1 bln

July 5 (Reuters) - Centerra Gold Inc

* Centerra Gold and Thompson Creek announce transformational business combination

* Total transaction value, including assumption of capital lease obligations, is equal to approx. $1.1 billion

* Centerra will redeem all of Thompson Creek’s secured and unsecured notes at their call price plus accrued and unpaid interest

* Arrangement agreement has been approved by board of directors of each of Centerra and Thompson Creek

* Endako, Thompson Creek mines will be kept on care and maintenance, Thompson Creek mill will continue to be used as concentrate upgrade facility

* Exchange ratio for deal implies consideration of c$0.79 per thompson creek common share

* Upon deal closing, Royal Gold’s 52.25% gold streaming interest at mount milligan to be amended to 35% gold stream, 18.75% copper stream

* Redemption of Thompson Creek’s 9.75% secured notes to also be financed with c$170 million bought deal subscription receipt offering

* Upon completion, existing Centerra, Creek shareholders expected to own about 92% and 8%, respectively, of pro forma company

* Deal expected to be accretive to cash flow, NAV, reserves and production per share

* Addition of secondary crushing at Mount Milligan mine by year end 2016, as planned, expected to increase throughput to over 62,500 tpd

* All Thompson Creek outstanding shares will be exchanged on basis of 0.0988 of centerra share for each Thompson Creek common share

* Addition of secondary crushing at Mount Milligan mine by year end 2016, expected to increase throughput to more than 62,500 tpd

* Redemption of Thompson Creek’s notes expected to be financed with new $325 million senior secured revolver, term loan facility by scotiabank

* Arrangement agreement includes provisions including $35 million termination fee payable to Centerra under certain customary circumstances Source text for Eikon: Further company coverage: (Bengaluru Newsroom: +1-646-223-8780)

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