Eskay buys 19.5% stake in Garibaldi Resources, shares up

Eskay Mining has entered an agreement to acquire approximately 23.7 common shares of Garibaldi Resources, valued at $10.8 million.

In consideration, Eskay will issue 4.2 million working capital units at $2.56 per unit to the foundation. Each unit consists of one common share and one warrant.

The acquisition by Eskay represents 19.5% of the current issued and outstanding shares of Garibaldi, which recently drilled its deepest nickel-copper yet at its E&L deposit, located within the Eskay mining camp of northwestern B.C.

Each warrant entitles the holder to purchase one common share at $2.82 each until the earlier of the date two years following the closing of the acquisition; and, in the event that the closing price of the common shares on the TSX Venture is at least $3.72 for 20 consecutive trading days, and the 20th trading day is on or after Aug. 1, 2021, the date which is 30 days from the final trading day.

Shares of Eskay Mining surged to a 52-week high on Friday on the latest acquisition. The stock was up 9.2% to $3.08 a share by 12:30 p.m. EST, giving the Toronto-based miner a market capitalization of $481.9 million.

Shares of Garibaldi Resources also soared, up 21.8% to $0.48 a share. The company's market capitalization stands at $46.96 million.

This story first appeared on www.MINING.com.