Aura Minerals Inc. and Rio Novo Gold Inc. Announce Merger Transaction

Aura Minerals Inc. (TSX:ORA) (“Aura”) and Rio Novo Gold Inc. (TSX:RN) (“Rio Novo”) announced today that they have entered into an agreement (the “Merger Agreement”) to combine and create strong portfolio of mining properties with a long term production life. The combination will be effected by a plan of merger under section 170 of the British Virgin Islands Business Companies Act, 2004 pursuant to which Aura will, among other things, acquire all of the shares of Rio Novo and Rio Novo shareholders will receive 0.053 of an Aura common share for each Rio Novo share held. The combined entity will operate under the Aura name and will remain listed on the Toronto Stock Exchange.

Rodrigo Barbosa, CEO of Aura, commented, “We are very excited to announce this strategic transaction. The transaction creates new opportunities for both Aura’s and Rio Novo’s shareholders. For Aura this opportunity provides a great new pipeline for growth, and for Rio Novo’s shareholders, a company committed to developing its assets.”

Patrick Panero, President and CEO of Rio Novo, added, “We are excited to unite our companies, giving our shareholders access to Aura’s strong operating mines and healthy balance sheet, thereby creating the opportunity for development of our existing portfolio of assets within the newly merged and enlarged company.”

Transaction Details

Under the terms of the Merger Agreement, Aura will, among other things, acquire all of the shares of Rio Novo and Rio Novo shareholders will receive 0.053 of an Aura common share for each Rio Novo share held. The combination will be subject to the approval of a majority of the votes cast at special meetings of Aura and Rio Novo shareholders to be held on or about February 2018, as well minority shareholder approval in accordance with Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (“MI 61-101”) at each of the Aura and Rio Novo special meetings.

Votes held by Northwestern Enterprises Ltd. (“Northwestern”) and certain other insiders of Aura and Rio Novo will be excluded for purposes of the minority approval vote required by MI 61-101. The transaction is also subject to other customary closing conditions. The Merger Agreement provides for, among other things, customary reciprocal board support and non-solicitation covenants, with “fiduciary out” provisions that allow Rio Novo to accept a superior proposal in certain circumstances and a 10-business day “right to match period” in favour of Aura. The Merger Agreement also provides for reimbursement of expenses for either party up to a cap of CAD $1M if the Merger Agreement is terminated in certain specified circumstances.

Northwestern, which currently holds approximately 52% of Aura’s common shares and 65% of Rio Novo’s common shares, has entered into a customary voting and support agreement pursuant to which, among other things, it has agreed to vote its Aura common shares and Rio Novo common shares in favour of the transaction. Northwestern is controlled by Paulo de Brito, who currently serves as Chairman of Aura. Following closing, it is expected that the combined company will have approximately 43,039,156 shares issued and outstanding and Northwestern is expected to hold an approximate 55.3% interest in the combined company. The other directors and senior officers of each of Aura and Rio Novo have also entered into customary support and voting agreements to vote their shares in favour of the combination. The Merger Agreement will be filed under each of Aura’s and Rio Novo’s profiles on SEDAR (www.sedar.com). The terms of the transaction and related matters will also be described in detail in a joint management information circular of Aura and Rio Novo to be filed with the regulatory authorities and mailed to shareholders in accordance with applicable securities laws.

Fonte: Aura Minerals