CMOC Singapore, a subsidiary of China-based CMOC Group, has entered an arrangement agreement with Canadian miner Lumina Gold to acquire all issued and outstanding shares of Lumina at C$1.27 per share, for a total equity value of approximately C$581m ($419.3m).
Shareholders holding 52.3% of Lumina shares have agreed to support the transaction, which includes immediate liquidity and removes risks associated with future dilution and commodity prices.
In conjunction with the arrangement, CMOC has agreed to provide Lumina with interim financing of $20m to support the Cangrejos gold-copper project in Ecuador.
The financing comes in the form of convertible notes with a 6% annual interest rate, maturing on 21 April 2026, and convertible into Lumina shares at C$1 each.
The private placement of convertible notes is expected to close on 30 April 2025, subject to TSX Venture Exchange acceptance and not contingent on the transaction’s completion.
Lumina CEO Marshall Koval said: “After advancing the Cangrejos project for over ten-years and taking it from no defined resources to being poised to be one of the largest gold projects globally, the Lumina Group is excited for the transition of the Cangrejos project to CMOC. The Lumina team looks forward to working with CMOC and all existing stakeholders to ensure the successful future development of the project.”
The all-cash transaction, to be executed via a court-approved plan of arrangement, includes provisions for a non-solicitation covenant, a “fiduciary out” and a termination fee of C$23.28m payable to CMOC under certain conditions.
Lumina options and restricted share units will be settled for their in-the-money value at the transaction’s effective time.
Completion of the acquisition is subject to several conditions including approval by Lumina securityholders, acceptance by the TSX Venture Exchange and approval from the British Columbia Supreme Court.
The transaction is expected to conclude in the third quarter of 2025 (Q3 2025), after which Lumina shares will be delisted.
The Lumina board, advised by RBC Capital Markets and following a special committee’s recommendation, has unanimously approved the transaction and advises shareholders to vote in favour.
Legal counsel for Lumina includes Borden Ladner Gervais, Skadden Arps Slate Meagher & Flom and Tobar ZVS in Canada, the US, and Ecuador, respectively.
BMO Capital Markets is advising CMOC, with McCarthy Tétrault and Bustamante Fabara acting as legal counsel in Canada and Ecuador.
In November 2024, Lumina Gold signed a binding term sheet with the Government of Ecuador to finalise the exploitation contract for its Cangrejos project.
