LONDON, UK / ACCESSWIRE / September 13, 2017 / Pro-Trader Daily takes a look at the latest corporate events and news making the headlines for Coeur Mining, Inc. (NYSE: CDE), following which we have published a free report that can be viewed by signing up at http://protraderdaily.com/optin/?symbol=CDE. The Company announced on September 11, 2017, that it has signed an agreement to buy privately-owned JDS Silver Holdings, Ltd and its wholly-owned subsidiary, JDS Silver Inc. (JDS Silver), which owns the high-grade silver-zinc-lead Silvertip mine located in northern British Columbia (BC), Canada. The acquisition adds a sixth producing mine to Coeur Mining's North American-focused platform. For immediate access to our complimentary reports, including today's coverage, register for free now at:

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The transaction is expected to close in late October 2017, and is subject to customary closing conditions and regulatory approvals.

Financial Details: Plan of Arrangement

  • Coeur Mining is expected to initially pay US$200 million, consisting of US$146.5 million of cash, US$38.5 million of Coeur Mining's shares (approximately 4.3 million new shares), and will assume US$15 million in existing debt.
  • Out of US$146.5 million cash, around $31 million will be used to retire JDS Silver's senior secured debt.
  • On the basis on a 10-day volume-weighted average Coeur Mining's stock price of $8.94 per share, the Company anticipates issuing 4.3 million new shares, representing an approximate 2% increase from its current outstanding share count of approximately 180 million.
  • Coeur Mining will use its existing cash and equivalents (around US$250 million as of June 30, 2017) to fund the cash portion of the initial consideration.
  • Before the transaction closes, the Company also plans to establish a US$200 million secured revolving credit facility.
  • Additional potential payments of up to US$50 million will be made upon achieving specific future permitting and exploration milestones at Silvertip.
  • Post acquisition, Coeur Mining is likely to invest US$25 million?US$35 million in surface infrastructure, accelerated underground development and drilling and mill optimization over a six-month period and recommence commercial production by the end of Q1 2018.
  • The first milestone payment of US$25 million depends upon the receipt of a permit expansion allowing for a sustained mining and milling rate of 1,000 tonnes per day on a year-round basis.
  • The second milestone payment of US$25 million is dependent upon the amount of resource tonnes added as of December 31, 2019, provided the total resource reaches 3.7 million tonnes.

Silvertip's Acquisition Likely to Provide Coeur Mining an Important Foundation in BC

Mitchell J. Krebs, Coeur Mining's President and Chief Executive Officer, mentioned that the acquisition of the Silvertip mine represents a unique opportunity to significantly enhance the Company's portfolio of operations and it satisfies all its acquisition criteria, provides expected near-term, low-cost, high margin cash flow from an attractive jurisdiction and it is accretive on all key operational and financial metrics. Mitchell further added that the acquisition of Silvertip, one of the highest-grade and newest operations in the sector with a tremendous amount of exploration potential, should serve to further accelerate these positive trends while providing Coeur Mining with an important foundation in BC.

Benefits of the Transaction

  • Silvertip is likely to generate an average annual EBITDA margin of over 50%, which is over twice Coeur Mining's 2016 adjusted EBITDA margin.
  • The acquisition is expected to be accretive to Coeur Mining's stockholders on all key operational and financial metrics.
  • Silvertip's average annual silver equivalent production of ten million ounces is likely to provide a potential increase to Coeur Mining's overall production profile.
  • Since considerable prior investments have taken place at Silvertip, Coeur Mining anticipates optimizing several aspects of this new operation, for minimal incremental capital.
  • The transaction will enhance Coeur Mining's geographic and political risk profile by adding BC, Canada, a top-tier mining jurisdiction, to its North American-focused asset portfolio.
  • Prospective 93,000-acre land position, where less than 5% has been explored provides opportunities for resource growth and new discoveries.

Financial and Legal Advisors

Goodmans LLP serves as the legal advisor and Sprott Capital Partners serves as the financial advisor to Coeur Mining. Blake, Cassels & Graydon LLP and Bennett Jones LLP provided legal advisory services and Maxit Capital provided financial advisory services to JDS Silver.

About Coeur Mining, Inc.

Founded in 1928, Coeur Mining is a well-diversified, growing precious metals producer with five precious metals mines in the Americas employing approximately 2,000 people. It is headquartered in Chicago, Illinois.

About JDS Silver Inc.

JDS Silver Inc. is an emerging private mining company currently constructing the Silvertip Mine in Northern BC. JDS Silver is affiliated with JDS Energy & Mining, Inc., a company that delivers mining project concepts from inception to full operations.

Last Close Stock Review

On Tuesday, September 12, 2017, the stock closed the trading session at $9.38, rising 3.88% from its previous closing price of $9.03. A total volume of 2.03 million shares have exchanged hands. Coeur Mining's stock price surged 20.88% in the last one month and 27.10% in the past six months. Moreover, the stock gained 3.19% since the start of the year. The stock is trading at a PE ratio of 22.71 and currently has a market cap of $1.72 billion.

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