De Beers Canada Buying Peregrine Diamonds for $107 Million

By: Tomas Ronolski - AllPennyStocks.com News

Thursday, July 19, 2018

Canadian diamond explorer Peregrine Diamonds (TSX:PGD) said Thursday morning that it has agreed to be acquired by international diamond giant De Beers Canada in a deal with an equity value of about $107 million. Per the deal, De Beers will pay $0.24 per share in cash for Peregrine, a 50 percent premium to the price of the stock on Wednesday. It is the highest price for shares of PGD since January 2017 when the stock briefly printed 26 cents.
After meeting with financial and legal advisors and independent directors, the board of Peregrine has unanimously approved the agreement. All of the Vancouver-based company's directors and its two largest shareholders are in support of the acquisition.
The prize for De Beers, a unit of London-listed Anglo American PLC, is Peregrine's 317,213-hectare Chidliak Project, located on Baffin Island about 120 kilometres from Iqaluit, the capital of Nunavut. The project hosts at least 74 kimberlites (eight of which are potentially economic) and has a preliminary inferred resource of 22 million carats. Peregrine's current focus is on the CH-6 and CH-7 pipes as part of the initial phase of development of the project.
"The transaction ensures the next steps in mine development are taken by a world-class operator with recognized arctic mine development and operational experience, and ensures stakeholders will benefit from responsible development of this rare and unique diamond resource," said Tom Peregoodoff, president and chief executive officer at Peregrine, in a statement today.
Chidliak will join De Beers' Canadian portfolio that already includes the Victor, Gahcho Kue and Snap Lake mines. De Beers will also pick-up Peregrine's 8,494-hectare Lac de Gras Project in the Northwest Territories, located approximately 27 kilometres from the Diavik Diamond Mine.
Shares of PGD have shot ahead 46.9% in early Thursday trading to 23.5 cents on record volume of nearly 10 million shares only 30 minutes into the trading session.

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