Volta Resources Inc.'s stock nearly doubled in value in heavy trading Monday after Vancouver-based B2Gold Corp. agreed to acquire the company in an all-stock deal worth an estimated $63 million US.
B2Gold said the friendly deal with Volta, based in Toronto, includes 81 per cent ownership of an advanced gold project and 100 per cent of two exploration projects in Africa.
B2Gold said Volta's Kiaka gold project in Burkino Faso has the potential to produce, on average, 340,000 ounces of gold a year over the mine's 10-year lifetime.
"Our team has looked at many projects over the last several years, and Kiaka stood out as a technically strong asset with low technical risk that, in the appropriate gold price environment, could be one of B2Gold's largest sources of future gold production," B2Gold president and CEO Clive Johnson said in a statement.
Volta stock up on news of sale
Volta shareholders will receive 0.15 shares of B2Gold for each Volta share they hold — about 42 cents Cdn per Volta share based on Friday's closing price — on condition the deal is approved by Volta shareholders.
On Monday, Volta's stock jumped 20.5 cents to trade at 41 cents on the Toronto Stock Exchange, with 5.7 million traded in the first half hour. B2Gold's stock price was little changed, with 1.8 million traded.
Volta's board has agreed to give B2Gold the right to match any competing offer and would pay a $2 million fee under certain circumstances if the deal doesn't close.
"In a difficult market where financing of development-stage gold companies has become increasingly challenging, we are very pleased to be partnering with an intermediate gold producer that has both the financial and technical capabilities to advance Kiaka for the benefit of Volta shareholders," said Volta president and CEO Kevin Bullock.