Torex Gold Resources Inc. press release
Torex Gold to Acquire Prime Mining
TSX - Toronto Stock Exchange · Gold · Silver · Copper · Canada
Combination creates a leading diversified Americas-focused precious metals company
(All amounts expressed in Canadian dollars unless otherwise stated)
TORONTO, July 28, 2025 (GLOBE NEWSWIRE) -- Torex Gold Resources Inc. (“Torex”, the “Company”) (TSX:TXG) (OTCQX:TORXF) and Prime Mining Corp. (“Prime Mining”) (TSX: PRYM) (OTCQX: PRMNF) (Frankfurt: O4V3) are pleased to announce that they have entered into a definitive agreement (the “Arrangement Agreement”) whereby Torex will acquire all of the issued and outstanding common shares of Prime Mining (the “Prime Mining Shares”) pursuant to a plan of arrangement (the “Transaction”).
The Transaction will result in Torex owning a 100% interest in Prime Mining’s multi-million ounce Los Reyes gold-silver project (“Los Reyes” or the “Los Reyes Project”). The Los Reyes Project is located in Mexico, a jurisdiction in which Torex has successfully worked since 2010 and built unrivalled local expertise in terms of operational excellence, project development, project permitting, community relations, and stakeholder engagement. The Los Reyes Project is a highly prospective, advanced exploration/development-stage asset hosting a combined underground and open-pit mineral resource of approximately 1.5 million ounces (“Moz”) gold and 54.0 Moz silver in the Indicated category and 538 thousand ounces (“koz”) gold and 21.6 Moz silver in the Inferred category. ( 1)
Pursuant to the terms of the Arrangement Agreement, Prime Mining shareholders will receive 0.060 of a common share of Torex (each whole share, a “Torex Share”) for each Prime Mining Share held (the “Exchange Ratio” or the “Consideration”), implying a 32.4% premium to the 30-day volume-weighted average price (“VWAP”) of the Prime Mining Shares based on the 30-day VWAP of the Torex Shares for the period ended July 25, 2025 and an 18.5% premium to the closing price of the Prime Mining Shares on the Toronto Stock Exchange (“TSX”) on July 25, 2025. The Exchange Ratio represents a price of $2.57 per Prime Mining Share based on the closing price of the Torex Shares on the TSX on July 25, 2025 and implies an equity value for Prime Mining of approximately $449 million (US$327 million).
Upon completion of the Transaction, Torex will issue approximately 10.5 million Torex Shares to Prime Mining shareholders and existing Prime Mining shareholders will own approximately 10.7% of Torex.
STRONG STRATEGIC RATIONALE AND BENEFITS FOR TOREX SHAREHOLDERS
Creates a high-quality diversified gold, silver, and copper producer Diversifies Torex’s asset base by adding a high-quality advanced exploration/development-stage asset in Mexico Significantly enhances Torex’s medium and long-term growth potential, particularly when considered alongside Torex’s recently announced acquisition of Reyna Silver Leverages Torex’s existing Mexican expertise and project execution team to advance Los Reyes through development and production Opportunity for value creation through continued exploration and development of Los Reyes
Los Reyes boasts a sizeable gold and silver mineral resource, materially increasing Torex’s resource base Increases Torex's Measured and Indicated Resources by 32% to 6.2 Moz of gold and Inferred Resources by 44% to 1.8 Moz of gold ( 1, 2) Further diversifies Torex’s existing gold and copper commodity mix via material silver exposure, with Los Reyes adding 54.0 Moz of silver in the Indicated category and 21.6 Moz of silver in the Inferred category ( 1)
Substantial exploration upside at Los Reyes Project’s large, underexplored land package Exploration growth pipeline supported by three main high-grade discoveries in Z-T, Guadalupe East, and Central Significant exploration upside as the primary zones of mineralization remain open along strike and dip, along with several generative targets outside of the main resource areas Los Reyes has a long mining history dating back to the 1700’s with estimated historical production of approximately 1 Moz gold and 60 Moz silver at average grades exceeding 10 grams per tonne (“g/t” or “gpt”) gold and 500 g/t silver
Leverage Torex’s proven technical capabilities, in-country expertise, and strong financial position to advance Los Reyes Ability to maximize the value of Los Reyes by leveraging Torex’s expertise and established track record of exploration, community engagement, project development, and operating success in Mexico Utilize Torex’s strong balance sheet and significant expected free cash flow to fund Los Reyes through to production while remaining free cash flow positive
Enhanced capital markets appeal Further broadens shareholder base and adds a key shareholder in Pierre Lassonde, who has an unparalleled track record of execution and creating shareholder value
AN ATTRACTIVE TRANSACTION FOR PRIME MINING SHAREHOLDERS
Immediate and significant premium to Prime Mining shareholders Consideration represents an attractive premium to historical market prices of Prime Mining Shares. At the Exchange Ratio, the Consideration represents a 32.4% premium to the 30-day VWAP of the Prime Mining Shares based on the 30-day VWAP of the Torex Shares for the period ended July 25, 2025 and an 18.5% premium to the closing price of the Prime Mining Shares on the TSX on July 25, 2025
Participation in an established, high-quality, gold/copper producer with substantial growth potential All-share consideration provides Prime Mining shareholders the opportunity to continue to participate in the future upside potential of Los Reyes through their meaningful 10.7% ownership in Torex Prime Mining shareholders will benefit from exposure to Torex’s free cash flowing Morelos Complex, which boasts the producing El Limón Guajes and Media Luna mines along with the EPO development stage project. The Morelos Complex was the largest gold producer in Mexico in 2024, producing more than 450 koz of gold with a current mine life of over 10 years Enhanced exploration upside through Torex’s highly prospective Morelos Property in addition to a suite of highly prospective early-stage exploration projects through the proposed all-cash acquisition of Reyna Silver Corp. (“Reyna Silver”), which Torex announced on June 23, 2025 and is scheduled to be considered by Reyna Silver’s securityholders on August 11, 2025
De-risks development of Los Reyes by leveraging Torex’s Mexican expertise and strong technical capabilities Torex brings deep and recent expertise in discovering, permitting, building, and operating mines in Mexico. Torex completed the construction of the ~US$800 million El Limón Guajes mine in 2015 and commenced commercial production in April 2016. More recently, Torex completed the ~US$1.0 billion (“bln”) Media Luna mine and commenced commercial production in May 2025. Torex delivered both projects largely on schedule with minimal deviations from their original budgets. Torex has an experienced Mexican permitting and project/construction team ready and available to advance Los Reyes
Significantly enhanced financial strength The Transaction provides Prime Mining’s shareholders access to Torex’s strong balance sheet, liquidity, and growing significant free cash flows from Media Luna. These strong financial resources support the advancement of Los Reyes and eliminate financing and dilution risks to bring the project into production
Enhanced Capital Markets Profile Torex has a market capitalization of ~US$2.7 billion, enabling Prime Mining shareholders to benefit from increased market presence, analyst coverage, investor demand, and trading liquidity
CEO AND SHAREHOLDER COMMENTARY
Jody Kuzenko, President and Chief Executive Officer of Torex, stated:
“The Los Reyes Project represents a unique opportunity for the Torex team to develop a high-quality asset with the potential for a high margin, low capital, and long-life operation in a jurisdiction that we know very well. The acquisition of Prime Mining, and the previously announced all-cash acquisition of Reyna Silver, support our strategy to systematically build a diversified, Americas-focused precious metals producer with a portfolio of producing, development, and exploration stage assets.
“Our extensive due diligence reinforced the scarcity of an asset of this quality, and we look forward to demonstrating the significant value we see in this exciting project. Los Reyes has multiple high-potential mineralized zones which remain open along strike and at depth, and we are confident that the project has strong untapped upside with numerous avenues for growth.
“Over the last 15 years, the Torex team has demonstrated the technical and in-country expertise to successfully advance projects from exploration through to development and production in Mexico, delivering considerable value to our shareholders. We will leverage these competencies, along with our significant expected free cash flow from the now completed Media Luna Project, to unlock and maximize the value of Los Reyes through development and production. We look forward to building strong relationships with the local communities in Cosalá, and we will work with them to ensure that the project delivers meaningful and sustainable benefits, just as we have and continue to do at Morelos.”
Scott Hicks, Chief Executive Officer and Director of Prime Mining, added:
“The addition of Prime Mining’s high-quality Los Reyes Project to the Torex pipeline as its next development asset presents both Prime Mining and Torex shareholders with substantial value enhancement through this share-based acquisition. In addition to gaining exposure to Torex’s free-cash flowing Morelos Complex, Prime Mining shareholders can continue to realize significant value creation as Los Reyes is developed with the benefit of Torex’s operational and development experience in Mexico. Both companies are aligned in their community and employee-focused values, approach to environmental stewardship and commitment to ensuring that all stakeholders will benefit through this combination. Prime looks forward to working with Torex through the transitionary period.
“Our Board, Management, and key shareholders view this opportunity as a great way to de-risk and unlock the full exploration and project potential that we collectively see in Los Reyes through our meaningful pro-forma ownership in Torex. I would like to take this opportunity to thank the Prime Mining team, Board of Directors, and our other stakeholders for all their outstanding contributions in getting Prime Mining to this exciting stage.”
Pierre Lassonde, commented:
“I am truly excited to be a part of this business combination. Jody and her team are, like us, proven creators of shareholder value. The Morelos Complex is a world class asset that, combined with our high-grade Los Reyes gold-silver deposit, will deliver outsized shareholder returns. I would like to thank Scott, Murray, and the team at Prime Mining for advancing the high-grade, gold-silver system at Los Reyes, and I look forward to working with Jody, Rick, and the team at Torex as we aim to do our part in building a new high-margin, intermediate gold producer.”
TRANSACTION SUMMARY
The Transaction will be completed pursuant to a court-approved plan of arrangement under the _Business Corporations Act _(British Columbia). The Transaction will require approval of at least: (i) 66 2 / 3 % of the votes cast by the shareholders of Prime Mining; (ii) 66 2 / 3 % of the votes cast by the shareholders of Prime Mining and the holders of options (“Options”), restricted share units (“RSUs”), deferred share units (“DSUs”), and warrants (“Warrants”), voting together as a single class; and (iii) a simple majority of the votes cast by the shareholders of Prime Mining, excluding those votes attached to Prime Mining Shares held by persons required to be excluded pursuant to Multilateral Instrument 61-101 – _Protection of Minority Security Holders in Special Transactions _(“MI 61-101”), at a special meeting of Prime Mining securityholders expected to be held in September 2025. The Transaction does not require a vote of Torex shareholders.
Pierre Lassonde as well as the directors and senior officers of Prime Mining, who collectively own 23% of the Prime Mining Shares, have entered into voting support agreements, pursuant to which, subject to the terms and conditions set forth therein, they will vote their securities held, as applicable, in favour of the Transaction.
In addition to securityholder and court approvals, the Transaction is subject to applicable regulatory approvals (including approvals of the TSX and clearance under Mexican antitrust laws) and the satisfaction of certain other closing conditions customary for a transaction of this nature. The Arrangement Agreement includes customary deal protections, including fiduciary-out provisions, non-solicitation covenants, and the right to match any superior proposals. Additionally, a termination fee payable in an amount of US$12.5 million is payable to Torex by Prime Mining in certain circumstances if the Transaction is not completed.
Pursuant to the Arrangement Agreement, all outstanding Prime Mining RSUs and DSUs which remain outstanding at the effective time of the Transaction will be deemed to be exercised or settled, for their in-the-money value net of withholding taxes, as applicable, under the arrangement for Prime Mining Shares, which will be exchanged for Torex Shares based on the Exchange Ratio. Outstanding Options will be adjusted to, among other things, be exercisable for Torex Shares, and outstanding Warrants will be adjusted in accordance with their terms.
Subject to the satisfaction of customary closing conditions, including the parties obtaining the requisite regulatory approvals, the Transaction is expected to close in H2 2025, subject to the timing of clearance under Mexican antitrust laws. The Prime Mining Shares are expected to be delisted from the TSX promptly after closing of the Transaction.
Full details of the Transaction will be included in the meeting materials to be prepared by Prime Mining in connection with the special meeting of securityholders, which are expected to be mailed to such securityholders in September 2025.
None of the securities to be issued pursuant to the Transaction have been or will be registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”), or any state securities laws, and any securities issued pursuant to the Transaction are anticipated to be issued in reliance upon available exemptions from such registration requirements pursuant to Section 3(a)(10) of the U.S. Securities Act and applicable exemptions under state securities laws. This press release does not constitute an offer to sell or the solicitation of an offer to buy any securities.
BOARD OF DIRECTORS’ AND SPECIAL COMMITTEE RECOMMENDATIONS
The Arrangement Agreement has been unanimously approved by the Board of Directors of Torex (the “Torex Board”), with Rick Howes not participating in deliberations of the Torex Board or voting on the Transaction given his role as CEO of Gold Candle Ltd., which has major shareholders in common with Prime Mining. Additionally, the Torex Board received a fairness opinion from CIBC World Markets Inc., which states that as of the date of such opinion and based upon and subject to the assumptions, limitations and qualifications set forth therein, the Consideration payable by Torex pursuant to the Arrangement Agreement, is fair, from a financial point of view, to Torex.
The Board of Directors of Prime Mining (the “Prime Mining Board”) appointed a special committee of independent directors (the “Special Committee”) to, among other things, consider and make a recommendation to the Prime Mining Board with respect to the Transaction. After consultation with its financial and legal advisors, and on the unanimous recommendation of the Special Committee, the Prime Mining Board unanimously determined that the Transaction is in the best interests of Prime Mining and approved the Arrangement Agreement. Accordingly, the Prime Mining Board and the Special Committee recommend that Prime Mining securityholders vote in favour of the Transaction.
The Prime Mining Board and the Special Committee received a fairness opinion from BMO Nesbitt Burns Inc., which states that as of the date of such opinion and based upon and subject to the various assumptions, limitations, qualifications and scope of review set forth therein, the Consideration to be received by Prime Mining shareholders (other than those Prime Mining shareholders whose votes are required to be excluded from the vote pursuant to Section 8.1(2) of MI 61-101), pursuant to the Transaction, is fair, from a financial point of view, to such Prime Mining shareholders.
ADVISORS AND COUNSEL
CIBC World Markets Inc. is acting as exclusive financial advisor to Torex. Cassels Brock & Blackwell LLP is acting as Torex’s legal advisor.
Trinity Advisors Corporation is acting as financial advisor to Prime Mining and its Board of Directors, and BMO Nesbitt Burns Inc. provided a fairness opinion to the Special Committee and the Prime Mining Board. Blake, Cassels & Graydon LLP is acting as Prime Mining’s legal advisor.
CONFERENCE CALL AND WEBCAST
Senior management from Torex and Prime Mining will host a conference call and webcast on Monday, July 28, 2025 at 8:00 AM (ET) for members of the investment community to discuss the Transaction.
Telephone Access
For expedited access to the conference call, registration is open to obtain an access code in advance, which will allow participants to join the call directly at the scheduled time. Alternatively, dial-in details are as follows:
Toronto local or International: 1-647-846-8914 Toll-Free (North America): 1-833-752-3842
Please join the conference call approximately ten minutes prior to the scheduled start time if using the dial-in details above.
Webcast Access
A webcast will be available on the Company’s website at www.torexgold.com/investors/upcoming-events/ . The webcast will also be archived on the Company’s website.
ABOUT TOREX GOLD RESOURCES INC.
Torex Gold Resources Inc. is an intermediate gold producer based in Canada, engaged in the exploration, development, and operation of its 100% owned Morelos Property, an area of 29,000 hectares in the highly prospective Guerrero Gold Belt located 180 kilometres southwest of Mexico City.
The Company’s principal asset is the Morelos Complex, which includes the producing Media Luna Underground, ELG Underground, and ELG Open Pit mines, the development stage EPO Underground Project, a processing plant, and related infrastructure. Commercial production from the Morelos Complex commenced on April 1, 2016 and an updated Technical Report for the Morelos Complex was released in March 2022.
Torex’s key strategic objectives are: deliver Media Luna to full production and build EPO; optimize Morelos production and costs; grow reserves and resources; disciplined growth and capital allocation; retain and attract best industry talent; and industry leader in responsible mining. In addition to realizing the full potential of the Morelos Property, the Company is seeking opportunities to acquire assets that enable diversification and deliver value to shareholders.
FOR FURTHER INFORMATION, PLEASE CONTACT:
| TOREX GOLD RESOURCES INC. | | Jody Kuzenko | | President and CEO | | Direct: (647) 725-9982 | | jody.kuzenko@torexgold.com | | | | Dan Rollins | | Senior Vice President, Corporate Development & Investor Relations | | Direct: (647) 260-1503 | | dan.rollins@torexgold.com | | |
ABOUT PRIME MINING CORP.
Prime Mining is managed by an ideal mix of successful mining executives, strong capital markets personnel, and experienced local operators all focused on unlocking the full potential of Los Reyes. Prime Mining has a well-planned capital structure with a strong management team and insider ownership. Prime Mining is targeting a material resource expansion at Los Reyes through a combination of new generative area discoveries and growth, while also building on technical de-risking activities to support eventual project development.