France’s Areva to exit Canadian gold miner La Mancha in $320m deal

French nuclear power group Areva SA (EPA:AREVA) said on Tuesday it had finalised the disposal of its holding in Canadian gold mining company La Mancha Resources Inc (TSE:LMA) in a deal that fetched some CAD315m (USD319.5m/EUR254.3m).

The 63% stake was taken by Weather II Investments, a business managed by Egyptian businessman Naguib Sawiris, which agreed last month to buy all shares of La Mancha. The company paid CAD3.50 per La Mancha share, or a premium of 55.6% to La Mancha’s closing on 12 July and 43.1% above the 20-day volume weighted average as of that day.

Areva expects to receive the proceeds from the divestment in the coming days. The money will go for further limiting the company’s debt and for funding its investments.

The sale of La Mancha’s stake is in line with Areva’s Action 2016 strategy, the French group noted.

When announcing the agreement with Weather II Investments in July, La Mancha’s president and CEO Dominique Delorme said the deal provided a significant premium to all shareholders and would allow La Mancha to continue developing its projects with partners in Sudan, Cote d’Ivoire and Australia.

The Canadian gold producer, which is active in Africa, Australia and Argentina, generated revenues of CAD184.7m and EBITDA of CAD83.8m last year, data by Areva shows.