Seeking Alpha

Alamos Gold (AGI -3.3%) agrees to acquire Esperanza Resources (ESPZF.PK) in a deal worth ~$69M....

Alamos Gold (AGI -3.3%) agrees to acquire Esperanza Resources (ESPZF.PK) in a deal worth ~$69M. Esperanza's gold project in Mexico holds 1.5M oz. of gold, and is expected to produce more than 100K oz./year at cash costs below $900/oz. upon completion. CEO John McCluskey says the deal has the potential to grow AGI's Mexican production by more than 50%.
Comments (3)
  • Uncle Pie
    , contributor
    Comments (3213) | Send Message
     
    Alamos is debt free and is therefore in a good position to cherry-pick among the decimated junior gold companies. It's not easy to find a profitable, debt free gold miner with a good record for growth.

     

    Long AGI (fingers crossed!)
    12 Jul 2013, 05:21 PM Reply Like
  • Russ Winter
    , contributor
    Comments (663) | Send Message
     
    This is incorrect. Esperanza has cash costs of $499, and a capex of $114 million.

     

    Esperanza also has 48 cents in cash, this is a great buyout for AGI.
    14 Jul 2013, 02:39 PM Reply Like
  • The Investment Doctor
    , contributor
    Comments (1094) | Send Message
     
    AGI bought Esperanza at 0.25X NPV of their project. Not a bad deal if they are able to straighten their permitting issues out.
    15 Jul 2013, 03:50 PM Reply Like
DJIA (DIA) S&P 500 (SPY)
ETF Hub
ETF Screener: Search and filter by asset class, strategy, theme, performance, yield, and much more
ETF Performance: View ETF performance across key asset classes and investing themes
ETF Investing Guide: Learn how to build and manage a well-diversified, low cost ETF portfolio
ETF Selector: An explanation of how to select and use ETFs