Recent Gold M&A Activity Has Benefited Buyers Not Sellers
Recent M&A activity in the gold mining industry has generally been to the benefit of the buyers, not the sellers.
Probably the worst deal we have seen was done in March 2025 when O3 Mining was acquired by Agnico Eagle Mines (AEM) for CAD$204 million. O3 Mining had total gold resources of 1.7 million oz directly adjacent to AEM's Canadian Malartic Mine. O3's Marban Alliance project was worth much more than CAD$204 million. Why did O3 accept such a bad deal? It was because of "change of control" provisions. O3's CEO had little/no stake in the company, but with a "change of control", he suddenly received a windfall of millions of dollars in cash, stock, and bonuses.
Imagine if Augusta Gold (TSX: G) with 1.92 million oz of total gold resources accepted only CAD$230.4 million or $2.68 per share for the company… how horrible that would be for shareholders. To maximize the value of the company, they need to develop their fully permitted Reward project (O3 didn't own any fully permitted gold projects), and bring it into production, which will cause Reward to be valued for the full Net Present Value of US$308.07 million or $4.42 per share (including debt repayment). This doesn't include any value for Bullfrog, which has 3.5x more gold only a few kilometers away. Including Bullfrog, Augusta Gold (TSX: G) can easily reach $10-$15 per share in the very near future.
Richard Warke owns a large percentage of Augusta Gold (TSX: G) shares outstanding and doesn't care about "change of control" provisions. He will only profit big by selling the company for the highest possible price. His interests are aligned with shareholders, unlike the management of O3 Mining who screwed everyone over.
The best M&A deal we have seen this year was Orogen Royalties (TSXV: OGN) being acquired by Triple Flag Precious Metals (TFPM), where TFPM is paying US$250 million for only a 1% NSR royalty in AngloGold Ashanti (AU)'s Arthur Gold Project directly adjacent to Augusta Gold (TSX: G)'s Reward and Bullfrog gold projects. TFPM didn't want any of OGN's non-Beatty, Nevada, assets they are all being spun off to OGN's existing shareholders as a new publicly traded company.
TFPM paying US$250 million for only a 1% NSR royalty in Arthur (formerly called Expanded Silicon) is a record-breaking amount. Therefore, we can expect any future deal to acquire Augusta Gold (TSX: G) to take place at a near record high valuation of at least US$500 per oz of gold resources or higher.
This is the biggest and most important new gold district to be developed this decade and Augusta Gold (TSX: G)'s Reward Gold Mine will be first to reach production in the district… with construction to begin as soon as Augusta's financing deal with the Trump Administration is complete.
Past performance is not an indicator of future returns. NIA is not an investment advisor and does not provide investment advice. Always do your own research and make your own investment decisions. NIA’s President has purchased 232,200 shares of G and may purchase more shares. This message is meant for informational and educational purposes only and does not provide investment advice.
