(By Balachander) Yamana Gold Inc. (TSE:YRI.TO) bolstered its presence in Argentina through the acquisition of Extorre Gold Mines Ltd. for around C$413 million ($403.4 million) in a cash and shares.
Shareholders of Vancouver-based Extorre will receive $4.26 per share consisting of C$3.50 in cash and 0.0467 percent of a Yamana share.
Extorre owns 95 percent of the Cerro Moro gold silver project in the Santa Cruz province of Argentina, with roughly 1.36 million ounces of gold equivalent indicated mineral resources and 1.05 million ounces of gold equivalent inferred mineral resources.
Commenting on the deal, Yamana Chief Executive Peter Marrone said Extorre "is a relatively small transaction in that it represents only 3 percent of Yamana's market capitalization...Yet it could ultimately deliver more than 10 percent of our total gold production."
Toronto-based Yamana said the deal could contribute meaningfully to increases in net asset value, production and cash flow.
The deal is expected to be completed in August 2012.
Yamana's financial advisors are Barclays Capital and CIBC World Markets Inc. on the transaction.